18 replies to this topic

[arbman]

The downside momentum was too great and the leadership is not still strong. However, we have the financials and industrials leading beside the materials, energy and utilities, but I think this rally should not fail...

My thinking here is we should see most of this rally given back into next week as this injection is just an injection rather than a new growth wave yet and it will wear off, but probably not a failure for several weeks. The major cycle lows are still due ahead, but it may only work out as a trading range now that the market is being supported. The frustration will be the name of the game...

All sectors now closed their gaps too, we can see down to 1000 below 1055 though, or perhaps lower. If the leadership gets fixed in the next pull back, we may see rather a much better sustainable and low volatility up trend...

http://stockcharts.com/c-sc/sc?s=$SPX&p=D&b=5&g=0&i=p50149259942&r=5612&.png

[NAV]

but I think this rally should not fail...

My thinking here is we should see most of this rally given back into next week

If we give back most of this rally, then it can only be deemed as failure. Those two statements are contradiction in terms.

All sectors now closed their gaps too, we can see down to 1000 below 1055 though, or perhaps lower.

And you still say this rally should not fail.

[Architect]

Don't worry about it. arbman has been on the wrong side most of the time.

[arbman]

NAV, we have to fail below 1040 to consider the rally failed, I consider any sell off back to 1040 as a consolidation at this moment, not failure. I think 1040-1050 will hold again and then a more sustainable rally may begin into October and top in November within 2 weeks...

The fact is the last 3 sessions have failed to penetrate below 1040 and I think this is what you should see next week as well, but most of the gains should be given back...

Don't worry about it. arbman has been on the wrong side most of the time.

Did you keep my stats actually? You should.

You could try to post your own analysis. I got the top of this move right and when the sustainable rally begins, I will be on it. I actually accumulated call options during the past 3 days, however the upside potential was not clear, this is as good as it gets for the short term imho.

I am interested in the major swings and I have been mostly right about them, I may not get every swing right and I think this rally will be given back mostly...

[arbman]

I guess more importantly, how I would trade this. People are buying the calls at the moment, I would sell a closing rally or tomorrow's highs, aggressively above 1080, and accumulate longs below 1065 with a stop 1040... If you are trading just 5-6 point swings or scalps, they are not going to be mentioned here. I got every 20 points or more swing all the way down right, the most deceiving rally was the July rally for me and it was basically given back and I accumulated shorts into it. The context right now favors accumulating longs for fall into early winter as long as 1040 holds and I think if 1035-1040 fails there will be still a bounce to get short positions. I think a failure below 1035-1040 is now due much later into winter or 2011 rather than immediately ahead. We should get enough indications next week...

[porsche911sg]

I am think it will break through 1080. Than a good short could be the opening high tomorrow the higher the better i will sell my longs into to flip short. Seriously i think we are in a trading range between 1040 to 1100. Either side will give way.

[arbman]

I am think it will break through 1080. Than a good short could be the opening high tomorrow the higher the better i will sell my longs into to flip short.

Seriously i think we are in a trading range between 1040 to 1100. Either side will give way.

I also think it is a trading range for now, but it should not fail lower or substantially lower, I think the trading will look like late May early June, actually it is a similar cycle low (16wk).

However, the rally that will come out of June 7 low (which is Sep 15-24 interval or so now) should not fail into October and rally well into November.

There is only 4 and 8 wk cycle lows due during that period and I think it will be volatile, but still an acceptable up trend. I do not know about new highs here, but 1150-1170 may be achieved unless the lows are broken over the next 2 weeks...

I expect the tops to be reached no later than Thanksgiving in US markets, then December should be weak and actually anything can happen from the second half of November into new year. I guess the long debated 900s will come thereafter...

Edited by arbman, 01 September 2010 - 02:58 PM.

[salsabob]

NAV, we have to fail below 1040 to consider the rally failed, I consider any sell off back to 1040 as a consolidation at this moment, not failure. I think 1040-1050 will hold again and then a more sustainable rally may begin into October and top in November within 2 weeks...

The fact is the last 3 sessions have failed to penetrate below 1040 and I think this is what you should see next week as well, but most of the gains should be given back...

Don't worry about it. arbman has been on the wrong side most of the time.

Did you keep my stats actually? You should.

You could try to post your own analysis. I got the top of this move right and when the sustainable rally begins, I will be on it. I actually accumulated call options during the past 3 days, however the upside potential was not clear, this is as good as it gets for the short term imho.

I am interested in the major swings and I have been mostly right about them, I may not get every swing right and I think this rally will be given back mostly...

I've been tracking your analysis pretty closely for about 8 months, and have found it to be amazingly good stuff. You had that confusion in July, as you mention, but hey, we're not perfect machines.

Your work and willingness to post are very much appreciated.

You don't need to explain yourself to trolls. And obviously I'm not suggesting NAV as one; he's pretty amazing as well. I think he just occasionally likes to take a friendly poke at someone around his level. This other guy, however, yeesh.

[arbman]

Thank you Salsa, I do this for a living and I take the criticism very seriously as long as they are not insults. I do and I will make mistakes, but after all we are all following a timing criteria. Mine is based on the cycles of breadth and the cross correlations in between the cycles to estimate the intensity. I have a momentum model actually, rather than statistical model. There are secondary derivatives that go into my analysis, but this is not to place to dive into every detail anyway...

For this leg, I expected a 50 points sell off from 1070 and it fell short of my estimates, perhaps we will see it next and the cycle target will be satisfied anyway, but I am willing to take a bit risk if 1065 gap is tested as I think it should provide a bounce at least. OTOH, the gap should be tested at a minimum over the next week, perhaps sooner with the jobs report. I will sell at these nose bleeding levels for now

Here's my comment from my blog:

Aug 20, 2010: The trend still appears down despite the late recovery effort on Friday's close. We may actually see the most intense sell off next week as SPX may have already lost the 1070 support. The rally from the 1070 support hit the stiff resistance once again at 1100 and got rejected. We should see a low next week for a bounce into early September, however there is very little support in between the 1070 and the new lows. The market may loose this 50 points zone as fast as it recovered above it in early July. There seems to be still multiple cycles pushing the index down at the moment (short and intermediate term) and there is tremendous resonance in this move. A reversal or a bounce from the lower levels will also show the same characteristics and it should be a sharp one.

Apparently that level was 1040, instead of high 1120s or low 1030s as I was expecting, futures dipped below 1040 though and cash will eventually go there too, just like we visited the futures highs from last Sunday. So we got the sharp rebound into early September. In fact, I also noted that we should see the largest intervention today right after the close yesterday.

Now we should see a consolidation and most likely it will happen at lower prices. It is an intervention because the leadership in growth is not there. Perhaps as the money diffuses, the leadership may get fixed a bit better at lower prices though OR we will continue with this mediocre leadership higher to literally fall apart by the time the final high is reached. Such a top cannot be too far though, I am looking into more consolidation and a bit more sustainable rally...

Best...

[arbman]

Short SPX 1085 via ES options, OEX P/C is over 2 again btw ahead of nfp... Edit: VIX is also at the trend line on a log chart, probably a bounce is due...

Edited by arbman, 02 September 2010 - 11:00 AM.