11 replies to this topic

[eminimee]

Keep in mind it also marked significant bottoms in 04 and 06

http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=5&mn=6&dy=0&i=p84064905311&a=113972872&r=9742.png

[Rogerdodger]

We got Carl Swenlin's 20/50 cross way back in early November.
Also back in mid November, the RSP 50ma crossed thru the 200ma as a "long term sell signal" according to his most recent chart spotlight:

However, in recent months the (RSP) equal-weighted index has been under-performing the S&P 500 Index to the extent that the 50-EMA has already crossed down through the 200-EMA, a long-term sell signal. What this tells us is that money is focusing on the large-cap stocks the S&P 500 Index is being supported by fewer and fewer stocks.
Bottom Line: It is not impossible for the market to complete a sucessful retest and for the bull market to continue, but the tecnicals are worse than they have been since the last bear market ended, and it is difficult to be optimistic at this point.

I am happy to report that in Timer Digest's annual Timer of the Year issue Decision Point was ranked #5 Bond Timer for 2007 and tied for #2 Long-Term Stock Timer (2-years) for 2007.

Way to go Carl!

I will point out that we got a similar cross of both the 20/50 AND the 50/200 during the 2006 lows.
And it also marked the lows as Teaparty pointed out above.
So far, the two areas look like fractals.
Can we break that downtrend line?

http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=2&mn=0&dy=0&i=p61388360363&a=96927041&r=2544.png

Edited by Rogerdodger, 05 January 2008 - 11:40 AM.

[NAV]

Tea, Yes, i had this discussion with Indextrader last week. So far duing this bull market 2 out of 2 signals have failed, which makes the success rate of the signal 0%. If we suceed this time, it's sucess rate would be 33%. Dreadful signal indeed

Edited by NAV, 05 January 2008 - 12:28 PM.

[borland]

If you had shown price in logrymthic scale, today's correction might look more like the 04' consolitation pattern. But.... What's different now than 04' and 06' is the 50/200MA crossover... - came at the end of the corrective phase while the markets had already started to recover. - lower highs and lower lows had been in the works for a few to several months when the markets recovered. We are now just starting to seeing this pattern of lower highs and lower lows. So you might conclude that the corrective phase will need several more months to complete, however the economy seems to be in a different state than the recoveries of 04' and 06'. It might be interesting to look at some consolidation patterns during the Carter Administration when we had similar economic conditions (Stagflation). Thanks for the great charts.

[IndexTrader]

Tea,

Yes, i had this discussion with Indextrader last week. So far duing this bull market 2 out of 2 signals have failed, which makes the success rate of the signal 0%. If we suceed this time, it's sucess rate would be 33%. Dreadful signal indeed

I guess you now decided to leave out that 3rd signal in 2000. But like I said, if you don't like the signal just fade it, which you promptly did a couple of days later to your detriment. I think this signal will work fine in the bear market we are now in. I'd link to the thread but evidently they have the search function blocked.

IT

Edited by IndexTrader, 05 January 2008 - 04:03 PM.

[Rogerdodger]

I'd link to the thread but evidently they have the search function blocked.

Sometimes that has been done in the past to free up the system, especially during attacks.
However, I don't know if it's going on now.

[Pabst]

You indicator guy's can refer to this decade as much as you like but boreland is right (and Index Trader knows this also), y'all better chart up on knowing the 60's and 70's. SPX 1550 and DAX 8000 sure seem like Dow 1000.

To those of you who keep talking about comparison's to 2004 or 2006, it's a different world now. Did you see inflation above targeted levels in 2004? Any $100 oil, $10 Wheat and $850 gold back then? Did you see job creation slowing in 2004? Did you see a banking crisis along with falling home prices?

Did you see the market back then rallying on rate hikes? YES. Now what do you see the market doing on rate cuts? Do you see the populist movement behind those Iowa results? This stuff will CRASH like no to-morrow this year. 30-40% by summer of 2009. I'd get out of the habit of buying dips. Uncle Ben can only bail you out so many times.

There is of course one caveat. If Bernanke/Paulson/Bush keep trashing the dollar and savers to boost asset prices then we can finally have what they ultimately want. Brazil. IBM could trade $1000. Right along with an $80 loaf of bread.....

Edited by Pabst, 05 January 2008 - 07:25 PM.

[Rogerdodger]

To those of you who keep talking about comparison's to 2004 or 2006, it's a different world now.

You are so correct.
It is easy to have myopic vision and see the events closest to us.

[kwest]

If you look at the chart in terms of an Elliott impulse wave (a 5 wave pattern), the 2 "false alarms" (2004 and 2006) would be what you'd expect to find during Wave 2 and Wave 4 corrections. The 3rd MA cross would be expected at the completion of Wave 5. The trendline, broken last month, confirms the completion of Wave 5. So from an Elliott perspective, its reasonable to see 2 "failed" signals, and then the real one.

[NAV]

Tea,

Yes, i had this discussion with Indextrader last week. So far duing this bull market 2 out of 2 signals have failed, which makes the success rate of the signal 0%. If we suceed this time, it's sucess rate would be 33%. Dreadful signal indeed

I guess you now decided to leave out that 3rd signal in 2000. But like I said, if you don't like the signal just fade it, which you promptly did a couple of days later to your detriment. I think this signal will work fine in the bear market we are now in. I'd link to the thread but evidently they have the search function blocked.

IT

I am neither using that signal nor fading it. I have my own signals. I am just stating that it's a signal without any edge and it's a fact.

BTW i got out of my longs for a small profit a couple of days back. So i don't understand what this "to your detriment" stuff is. That signal has no bearing on VST trades which makes your point moot.

Edited by NAV, 05 January 2008 - 10:39 PM.