Jump to content



Photo

Market Turns Advisory 11/18/4


  • Please log in to reply
No replies to this topic

#1 TTHQ Staff

TTHQ Staff

    www.TTHQ.com

  • Admin
  • 8,597 posts

Posted 18 November 2004 - 12:06 PM


S&P 500 CASH


SPX CASH:
Daily Projected Support andResistance levels: High - 1190; Low - 1177
DEC SP: Daily Projected Support and Resistance levels: High - 1189; Low -1176
SPX CASH: 5-Day Projected Support and Resistance levels: High - 1195; Low -1173
DEC SP: 5-Day Projected Support and Resistance levels: High - 1194; Low -1172
SPX CASH: MonthlyProjected Support and Resistance levels: High - 1162; Low - 1110
SPX CASH:
Yearly Projected Support and Resistance levels:High - 1274; Low - 950


Current SPX Index Positions:
Mid-term (6-8 weeks) = NEUTRAL
Short-term (1 day-3 weeks) = 75% BULLISH from 1179.47 (avg price)


From previous outlook:
"The SPX tested weekly support (1173, plus or minus)with the intraday tag of 1175.32. The move down came on 1.35 billion shares, which isabout a 7% contraction from the volume numbers seen in Monday’s session. This to meindicates that the current move down is corrective and should be followed by higher highsupon completion. In the weekend outlook I noted key first support at the 1173-1177 region;if that holds off any drop here - and particularly the lower end on a closing basis - thenthe probabilities will favor at least one more run to new swing highs in the coming daysand more likely by the end of the week. If we do manage to make new swing highs for themove, as noted last night the natural magnet for price will be the 1190-1195 region, whichencompasses several resistance
areas on the weekly chart, including the current weekly projected resistance high."




Current analysis:
In the weekend outlooks the basic call was that if a drop intosupport (1173- 1177 SPX CASH) was seen on an early week time low, that the probabilitiesfavored the lower end of this range would hold on a closing basis would then be followedby new swing highs going into late week for a test of the 1190-1195 resistanceregion.  Yesterday’s low was 1175.32, which tested outlined support and was thenfollowed by new swing highs for the move in today’s session, tagging 1188.46 at theintraday peak. Volume today came in at 1.7 billion shares, which is a solid 20% increasefrom Tuesday’s session and is about equal with the heaviest volume day we have seenfor this move, which indicates that today’s 1188 swing top should be taken out in thecoming days.
What is interesting tonight is that both the 10 and 20 day cycleoscillators are moving into normal oversold region, even as the market s consolidatingnear the high end  of the range. This is bullish and is yet another reason toexpect higher highs following any short-term correction that might develop in the comingdays on this index. Of note here is that key support is now 1174.99 SPX CASH on anintraday basis; if this were to be taken out lower anytime soon then it would be ourconfirmation that the down phases of the 10 and 20 day cycles are in progress. Keep thisnumber in mind in the coming sessions, as we know from the statistical analysis of thesetwo cycles that a drop of 1.4% to 2% or better is the norm going into a 20 day cycle low.As a side note, if the 20 day oscillator from above were to now turn up from below theoversold level, then that instead would be our indication that the low for this cycle isin place - even if the normal correction never materializes with the above.

From the above notes then we can infer anything above the 1174.99 area on the SPX for theshort-term will allow for a test of the 1190-1195 region in the coming sessions. If1174.99 were to instead be taken out south in the coming days then we know that theprobabilities are high that the down phase of both the 10 and 20 day cycles are in effectwith price, and that a 1.4% to 2% drop off the top is in progress. With that also thensaid and noted, how far would any correction lower carry before the last swing up is seen?Take a look at the chart:


 
From the chart above we can gain some additional information on what to expect if the SPXwere  to take out the 1174.99 region at any point here. The downside risk would befor a drop to the  bottom of the extrapolated 45 day cycle channel; the bottom ofthat channel is now at the 1152-1156 region and is rising daily. We also note that‘breakout’ support is at the 1160-1162 region, which implies the downside riskfor the short-term would be only to the 1160-1162 region, and that would be expected tosee higher highs following that. All of the above notes the possibility of a break ofthe 1174.99 region, which may or may not even be taken out during this 20 day cycle downphase. The market can easily hold above this area and continue to push to new swinghighs in the coming sessions and into Friday’s close. Stay tuned.

NASDAQ 100 CASH

Daily Projected Support and Resistance levels: High, 1582 - Low, 1563
5-Day Projected Support and Resistance levels: High, 1580 - Low, 1536
Monthly Projected Support and Resistance levels: High, 1531 - Low, 1451


Current NDX Index Positions:
Mid-Term (6-8 weeks) = NEUTRAL
Short-term (1 day - 3 weeks) = Back to NEUTRAL


From previous outlook:
"As per recent notes here, if the 1530’s were tobe tested on an early to mid-week low, then we will look for a higher high (above 1562) tobe seen later this week - and preferably a test of the 1570-1580 region, which is whereweekly projected resistance is currently located and is the natural magnet for price in anuptrend. So far the lowest we have seen was today’s 1541 low, but we still haveanother session or two to see if a test of weekly support develops. Again, if the1570-1580 region were to be tested before a test of lower support is seen, then we couldbe setting up for another short-term top here."



Current analysis: The recent call was for the 1530’s to hold thedownside on any selling, to be followed by a test of the 1570-1580 region on the followingswing up. Yesterday’s tag of 1541 ended up being the low for the move, which felljust short of a test of weekly support (1533-1537). That being aid, we did end up makingnew highs for the week, hitting 1580.26 in today’s session, which is right into theweekly resistance area. From there we saw a mild selloff back into what is now again firstsupport, near the 1560 region.

Volume on the NDX came in at a whopping 2.2 billion shares, which is the highest volumeday we have seen during this move up. Since we are making new swing highs for the move,this gives us better than a 95% shot that the index will be making higher highs above1580.26 in the coming sessions, correction or no correction. As per recent comments, Ithink we still have a date with the 1514-1517 region again at some point in the comingdays, but the action from price and volume indicates such a test is going to hold off nowuntil some point after Friday’s close. Short-term then, look for any drop lower to becontained by the 1558-1563 range, which is prior resistance and now new support; if thisholds then look for the index to try and mount a move to new swing highs above 1580 in thenext session or two. Stay tuned.


Jim Curry
Market Turns Advisory

Email:
jcurry@cycle-wave.com

Disclaimer - The financial markets are risky. Investing is risky. Past performance doesnot guarantee future performance. The foregoing has been prepared solely for informationalpurposes and is not a solicitation, or an offer to buy or sell any security. Opinions arebased on historical research and data believed reliable, but there is no guarantee thatfuture results will be profitable. The methods used to form opinions are highly probableand as you follow them for some time you can gain confidence in them. The market can andwill do the unexpected, use the sell stops provided to assist in risk avoidance. Notresponsible for errors or omissions. Copyright 2004, Jim Curry.