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B-wave rally to SPX 3,011-3,040?


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#1 dTraderB

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Posted 08 April 2019 - 05:30 PM

Many new predictions, some above SPX 3000

 

Here is one: 

In fall 2018, when I was warning about a 20%-30% correction I foresaw in the stock market, I also warned that within that “correction,” the market could make a new all-time high.

It may still do so, with this week giving us indications regarding those probabilities. Allow me to explain.

Over the past few weeks, as stocks have been approaching my target for this b-wave rally, my expectation was that the S&P 500 Index SPX, +0.10%  was going to top out in the 2,865-2,885-point region and turn down for the c-wave. However, the manner in which stocks have risen to this target suggests that this rally may have more legs to it than I initially expected in February, when I set this target. 

But if we go back before February, I had maintained some expectation that this b-wave rally could even make a higher high in the 3,011-3,040 region. You see, the wave 3, which topped in September, had an ideal target of 3,011. And when a 3rd wave fails to strike its ideal target (we came up about 70 points short), we often see the b-wave of the ensuing correction strike the target before turning down in the c-wave of that correction. That was the reasoning I had many months ago about why this b-wave could have potential to rally to that higher target.

MW-HH124_avi08_20190408091501_NS.png?uui

However, due to the overlapping structure we saw in February, along with the lack of pullback, I modified my target for this b-wave down to the 2,865-2885 region. Yet, as I highlighted in my Wednesday update, the manner in which we have now approached this modified target has developed a structure that can still take stocks up to the 3,011-3,040 region. So, unfortunately, I have to abide by the words purportedly stated by John Maynard Keynes: “When my information changes, I alter my conclusions. What do you do, sir?” So I apologize for the revised perspective, but I wanted to introduce it before it happened rather than after the fact.

 

So the structure has now opened the door back toward my initial thoughts of many months ago that this b-wave rally may still attempt to strike the levels that the 3rd wave failed to within the 3,011-3,040 level. But the market has to break through the 2,915 level to suggest this is the case.

Please make no mistake about the fact that we are now within a region that can turn us down strongly for a b-wave top. We have enough waves in place to consider the b-wave rally we have been tracking as truly completed. So, yes, we have reached another inflection point for the market. But the market will have to break down below 2,845 to begin to signal we have finally completed this three-month-long b-wave rally.

In summary, the market is now at an inflection point. As long as it remains below 2,915, there is enough of a structure in place for stocks to top out in a b-wave rally. And, should stocks break down below 2,845, that will start turning the probabilities back toward the potential that the b-wave has completed, and we will begin to track the setup that can take us down as low as 2,200 in the coming months. However, if the market is able to push through the 2,915 region, then it suggests stocks can rally as high as the 3,011-3,040 region, and I believe small-cap stocks will lead that segment of the rally.

Lastly, I want to reiterate that I think that this rally is still primarily a b-wave for all the same reasons I have outlined many times before. In fact, Bayesian probabilities are now calculated for it to be a 75% likelihood that this rally is a b-wave, even if we do go higher. That means whether it happens here or from a higher level, the bigger patterns suggest we can still revisit the 2018 lows, and may even break below them before the next major bull phase takes us to 3,500-4,000 into the years 2022/2023. At this time, this will seem like an impossibility to most. Well, I heard the same thing when I noted we can see a 20% drop from the 2,900 region last year.

https://www.marketwa...oint-2019-04-08



#2 dTraderB

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Posted 08 April 2019 - 05:33 PM

Technicians believe and have observed that the first wave in a new series has predictive implications - using the rule of seven. This procedure generates several targets - in this case, the first two are 3164 and 3434. 

 

 

15547416034121620708128.pnghttp://schrts.co/EETcHtyM

The power of this wave is illustrated here. The horizontal line is resistance and, as you can see, that resistance has stopped price many times. Two reactions here mark minor and major wave highs. The implications of this first recovery wave are great. Technicians believe and have observed that the first wave in a new series has predictive implications - using the rule of seven. This procedure generates several targets - in this case, the first two are 3164 and 3434. From the recently important level of 2800, these may be intimidating, and we do not present them as predictions or forecasts but as the products of the procedure.

15547416711651537629426.pnghttp://schrts.co/RsYRymYS

This reading may appear tenuous, but then there is the Point and Figure system, which looks for a target of 3659. This is a confirmation of the strength of the trend and the positive possibilities lurking in it.

 

https://stockcharts....e-snowball.html



#3 dTraderB

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Posted 08 April 2019 - 05:39 PM

Yeah, momentum decreasing but even my hourly MO chart is not showing any significant decline to suggest a move down; not saying it can't happen!

 

VIX hourly almost gave a BUY, but no cigar.

 

The Curious Case Of Ebbing Momentum
  • Jason Goepfert
     
     Published: 2019-04-08 at 11:38:31 CDT

No mo’ mo-mo?

Even as the S&P 500 index trades at a fresh 100-day high, the ratio of the S&P 500 Momentum Index to the S&P itself is struggling, and just hit a 30-day low.

1554727573384.jpg

This divergence is like what happened last August. Longer-term, failing momentum wasn’t a consistent negative, but three of the last four signals did lead to a decline in stocks.

A quality 70 days

Some momentum stocks might be faltering, but the price behavior of the major indexes has been pristine. The most benchmarked index in the world has now gone 70 days from its low, and based on similar rallies, it’s due to hit a new high any day now.

It’s also been a good sign when the index has suffered so few 1% down days, and so many gaps up at the opening of trading.

The latest Commitments of Traders report was released, covering positions through Tuesday

The 3-Year Min/Max Screen shows a few new extremes this week, with hedgers establishing multi-year extreme shorts in cattle, 5-year Treasuries, and hogs. In most other contracts, they made only minor adjustments, including in stock index futures.

A new trend

The MSCI Mexico Index closed above its 200-days for the first time in six months on Friday. Other times it went this long before ending a downtrend, it added to gains over the next month 5 out of 6 times averaging 4.6% (the sole loser was -0.7%).

https://www.sentimen...ebbing-momentum



#4 robo

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Posted 08 April 2019 - 05:43 PM

Many new predictions, some above SPX 3000

 

Here is one: 

In fall 2018, when I was warning about a 20%-30% correction I foresaw in the stock market, I also warned that within that “correction,” the market could make a new all-time high.

It may still do so, with this week giving us indications regarding those probabilities. Allow me to explain.

Over the past few weeks, as stocks have been approaching my target for this b-wave rally, my expectation was that the S&P 500 Index SPX, +0.10%  was going to top out in the 2,865-2,885-point region and turn down for the c-wave. However, the manner in which stocks have risen to this target suggests that this rally may have more legs to it than I initially expected in February, when I set this target. 

But if we go back before February, I had maintained some expectation that this b-wave rally could even make a higher high in the 3,011-3,040 region. You see, the wave 3, which topped in September, had an ideal target of 3,011. And when a 3rd wave fails to strike its ideal target (we came up about 70 points short), we often see the b-wave of the ensuing correction strike the target before turning down in the c-wave of that correction. That was the reasoning I had many months ago about why this b-wave could have potential to rally to that higher target.

MW-HH124_avi08_20190408091501_NS.png?uui

However, due to the overlapping structure we saw in February, along with the lack of pullback, I modified my target for this b-wave down to the 2,865-2885 region. Yet, as I highlighted in my Wednesday update, the manner in which we have now approached this modified target has developed a structure that can still take stocks up to the 3,011-3,040 region. So, unfortunately, I have to abide by the words purportedly stated by John Maynard Keynes: “When my information changes, I alter my conclusions. What do you do, sir?” So I apologize for the revised perspective, but I wanted to introduce it before it happened rather than after the fact.

 

So the structure has now opened the door back toward my initial thoughts of many months ago that this b-wave rally may still attempt to strike the levels that the 3rd wave failed to within the 3,011-3,040 level. But the market has to break through the 2,915 level to suggest this is the case.

Please make no mistake about the fact that we are now within a region that can turn us down strongly for a b-wave top. We have enough waves in place to consider the b-wave rally we have been tracking as truly completed. So, yes, we have reached another inflection point for the market. But the market will have to break down below 2,845 to begin to signal we have finally completed this three-month-long b-wave rally.

In summary, the market is now at an inflection point. As long as it remains below 2,915, there is enough of a structure in place for stocks to top out in a b-wave rally. And, should stocks break down below 2,845, that will start turning the probabilities back toward the potential that the b-wave has completed, and we will begin to track the setup that can take us down as low as 2,200 in the coming months. However, if the market is able to push through the 2,915 region, then it suggests stocks can rally as high as the 3,011-3,040 region, and I believe small-cap stocks will lead that segment of the rally.

Lastly, I want to reiterate that I think that this rally is still primarily a b-wave for all the same reasons I have outlined many times before. In fact, Bayesian probabilities are now calculated for it to be a 75% likelihood that this rally is a b-wave, even if we do go higher. That means whether it happens here or from a higher level, the bigger patterns suggest we can still revisit the 2018 lows, and may even break below them before the next major bull phase takes us to 3,500-4,000 into the years 2022/2023. At this time, this will seem like an impossibility to most. Well, I heard the same thing when I noted we can see a 20% drop from the 2,900 region last year.

https://www.marketwa...oint-2019-04-08

"Many new predictions, some above SPX 3000"

 

I call them guesses and it makes some EW dudes angry. EW dudes are the smartest guys out there - just ask them if you don't believe me.  Well, a few cycle guys claim to be smarter, but I think AVI is still the better trader. 

 

Good Guessing/Predicting to you, but the trend remains up until it's not.  More warning signs appearing today! My opinion is to take some more profits, but remain long....  Forget about shorting until we turn

 

Long VXF ( a much smaller position now) and I sold my GDXJ today. Looking to buy shares back. (GDXJ is a free trade at Vanguard and that is why it's so easy to buy and sell)  Waiting on the next VXXB trade and it just might be a good one....


Edited by robo, 08 April 2019 - 05:44 PM.

“There is only one side to the stock market; and it is not the bull side or the bear side, but the right side”   Jesse L. Livermore


#5 slupert

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Posted 08 April 2019 - 06:15 PM

should at least fill the last gap before it moves higher, more bullish if it fills it now.(JMHO)



#6 dTraderB

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Posted 09 April 2019 - 06:59 AM

Many super intelligent market experts do not seem to understand the 

strategy of lowering earnings estimates so that the COMPANY CAN THEN 

BEAT THE LOWERED ESTIMATE and success! up up up ... I look out for 

such opportunities !

I want to see low will be BOENGS' new yearly earnings estimate.... 

Very quiet morning so far,

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Ratio of negative-to-positive earnings guidance vs estimates. S&P 500.

D3tXtkbWAAAj164.jpg
4:46 AM - 9 Apr 2019

 



#7 dTraderB

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Posted 09 April 2019 - 07:02 AM

Maybe, but JAPAN has done fairly good and continues to be a leading global economy....

 

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Mohamed El-Erian warns Western economies on #Japanification. He points out that return of Europe's econ doldrums & signs of coming slowdown in US, suggests advanced econs could be at risk of falling into same kind of long-term rut that has captured #Japan. https://www.project-syndicate.org/commentary/west-japanization-low-growth-inflation-by-mohamed-a-el-erian-2019-04 

D3tQwEOXoAAr09B.jpg
4:16 AM - 9 Apr 2019


#8 dTraderB

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Posted 09 April 2019 - 07:03 AM

TOO DOVISH! 

Shocked to hear this...

 

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BlackRock cautious on Treasuries as markets seem too dovish. https://www.blackrockblog.com/2019/04/08/cautious-short-term-stance-toward-treasuries/ 

D3sRX3OW4AAXmsq.jpg
11:39 PM - 8 Apr 2019


#9 dTraderB

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Posted 09 April 2019 - 07:04 AM

The SAUDIS were supposed to keep the oil prices down?

They will hear soon from the President

 

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Ouch! #Oil prices hit 5mth highs as global mkts tighten amid Opec-led cuts, US sanctions against Iran & Venezuela and escalating violence in Libya.

D3sG4MJWkAA43oo.png
10:53 PM - 8 Apr 2019


#10 dTraderB

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Posted 09 April 2019 - 07:07 AM

Yeah, it gets quite silly on Business TV when they have to "explain" why SPX is up or down 2 points....

 

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Sven Henrich Retweeted Barron's

1f602.png

Sven Henrich added,

Barron'sVerified account @barronsonline
Dow Futures Dip 6 Points Because the Market Is Waiting for Earnings Season to Start https://on.barrons.com/2UnyUrI 
4:14 AM - 9 Apr 2019