Looks an important week to me here on the Intermediate Trend cycle, so i've reviewed my IT signal model in a little detail below for anyone interested.
Bottom line - I'm bearish the IT still here, and see high odds a move down to 2530-2550, but, also high odds a move to 2480 or even 2450 in panic move intraday ( not closing low). We can always bounce, but, I expect any bounce to be short lived, and limited to fib (50% max) retracements of proceeding drops.
Shorter term - monday: there is one setup for a bounce monday AM to 2640'ish - then begin to roll over again, but also a setup for a big move down monday. Sunday night ES might shed some light on that.
Of course, its a FED week, so maybe we get more 'games' and no resolution until post FED - but, that's about the only 'bullish' hope I can see right here.
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IT model - Liquidity(LQ), then Sentment, internals and price.
LQ - bearish for next week
Sentiment -Investor/Money Managers
Trader sentiment-
Internals - bearish.
Price Setup - bearish.
Bigger Picture - Still a bull? is it a bear?
I posted in spring a price pattern setup bullish into Autumn then sharp drop - see chart.
We executed that setup very closely, including the drop. I didn't show what occurs after, so,
it does not answer bull or bear. But I've said since October, I have us in 'transition period', which means
- there was a possibility of finding an IT low before xmas, and taking a last run toward the High.
- that possibility is low odds now, because as I said we have failed to trigger for an IT low.
Really, unless we crash, knowing its a 'bear' doesn't change much, the aim is to capture trades in BOTH directions whether its a bull or bear.
OK but the pattern I posted and current patterns, what kind of bear market does it imply?
A reasonable high odds target of those patterns is SPX 2300, more likely 2100 area over 18month period. Then high odds a 3-5 year bull market to significant All time highs.
OK but first, lets confirm this actually IS a bear market! we don't have price confirmation of that yet on my signals - I've got various high odds signals on price to confirm a bear market, but we haven't got any yet, though we are very close - a close in December under 2500 for example would do it.
note. not even breaking 2500 on daily basis will put us in confirmed bear, it's more of weekly/monthly, so its kinda moot right now - the transition period into a bear, or out of it into bull, is the hardest to get right and I prefer to take each IT moves up/down as it comes, and use that as confirmation. Right now, we are still in IT downmove, and I don't have buy signals, so the 'bears have the ball' and we'll see how far they run.
(* However, I would be remiss not to warn, there is a much more bearish alternate pattern, but that is now lower odds due to credit market signals I use, at least until 2025-2030 timeframe, but, it will become obvious if this were playing out in due course )
Disclaimers:
- just my personal views, not trading advice etc etc ..u know the drill -
- I'm very confident in my system, but I don't own the holy grail:- no one does, no one can say 100% what market will do. Trading is understanding there is always a high odds, and low odds setup: betting on the high odds setup, and having a stop in case its the low odds setup.
- I'm very confident in my system, but I don't own the holy grail:- no one does, no one can say 100% what market will do. Trading is understanding there is always a high odds, and low odds setup: betting on the high odds setup, and having a stop in case its the low odds setup.
- As per tag line, I can only trade my system and not worry about 'the news', other signals I don't use, or other opinions as that leads to analysis paralysis.
- Every new trading session is 'new information' that can change/alter the signals/setups and high/lows odds.
- For the short term system, I can't show most of the signals, because I developed unique ways of viewing market that is edge. I utilize mostly the following: price, momentum, volatility, liquidity, sentiment and my own fractal method to generate 'setups' (as opposed to multiple counts).
Questions/Clarifications welcome as time allows.
Edited by Entropy3.0, 16 December 2018 - 04:07 PM.
