I posted to my blog for first time in a month on Nov 1st as promissed -
( I can't seem to link to specific blog entries, for reference see November 1st entry)
- "..pattern I mentioned from the last intermediate low in Aug has continue to develop... and I believe it either completed yesterday, or there is one more minor new high to come in the next 3-5 days, then an intermediate top is in again....
If I am right, were about to explode to downside in the next few weeks.
* if we decline this afternoon in a huge down swoon, taking out spx 1510, and especially 1500...then the pattern should be complete already."
We did indeed swoon Nov 1 afternoon taking out 1510, confirming the pattern.
I declined to describe the pattern, as its based on ewave, especially since most consistently bemoan ewave, or misunderstand it - but I have said clearly this is a terminating pattern for the bull market similar to year 2000 termination pattern - perhaps due to the 'echo' nature of this bull market to that one.
The decline has done 'everything right' as described in my blog to confirm the pattern - it is certainly 'explosive' as I said it must be, but we are now at the critical point that every other decline has failed.( see chart at end of post) To confirm, we need to continue the decline and CLOSE below 1420 SPX, and ideally 1400, certainly that must happen before a rally above SPX 1490.
I believe this is going to happen within the next week, but the Very short term is a toss up here.
Interestingly, the ewave pattern actually does have the setup for much predicted and never to apear 'wave 3' down here, i'm talking a 400-500 point down day on dow, breaking all bull market supports. Right now futures are up so this seems unlikely..but should the market break todays low again tomorrow, this setup will remain on the charts - and will do so until Price get out of the downward Bollinger Bands. The short term internals also allow for this, but I don't want to talk about short term here...I'm trying to seperate short term into my blog, and longer term here on swing board.
You win some, you lose some. I never expected the rally off the August lows to go as far as it did -
I was wrong on that, but if I'm right on the above pattern, then I was right that any rally would resemble year 2000, and fail as that one did in the Autumn - though note, I am not suggesting the decline/bear market will be the same - I have no clue on that right now(OK I do but....)... I don't believe its possible to usefully predict such things.
Sentiment wise some bearishness is now showing up in measures I have, but we certainly haven't seen the kind of washout/capitulation we've seen at all bull market lows. I believe that bearishness won't occur untit/if we break SPX 1400 area - then everyone will likely turn bearish in time for a snap back rally.
Options players it seems are looking for 'turn around Tuesday', maybe they get it, but my money is and will be on any rallys failing, and new lows being made over the coming week, at least until we see a spike in put/call and Trin.
Some Charts which will update for reference-
HS setup target reached, close enough -
Watch BB band, climbing down band, and up it on Volatility, until we break out of this descent, the
'wave 3' down setup remains on here.
This is a simple tool for determining Bull/Bear - as you can see, were back the critical support line.
My intermediate technicals are firmly in downtrend, and weeks away from lows, so any rally, even a week long one will ultimately fail according to these, we haven't even seen a divergent low on NYMO yet, and summations continue to accelerate down.
Edited by entropy, 13 November 2007 - 12:47 AM.