MidWeek Color Bar Chart of the SP 500

May 27, 2009: 9:42 PM CST

Some readers enjoy seeing my “color charts” of the S&P 500 and here is a mid-week “Color Bar” update on the S&P 500 Daily Chart structure.

The color of the bars is derived from an average true range function of the most recent swing high (about 935).  Subtract 2.5 times the current ATR to ‘flip’ the color from green to red, or officially confirming (locking in) a swing up and beginning an official swing down.  This is an alternate way to define price ’swings’ as opposed to noting absolute swing highs and lows.

The yellow bars are simply ‘warning signs’ hinting that we could be getting a color reversal soon.

In this case, the red bars will flip should the S&P 500 hit the 875 level, which would be the official “volatility” adjusted beginning of a new downswing.

This formula was originally published by Wells Wilder and adapted by LBR Group into TradeStation functionality.  The 3/10 Oscillator was brought to the public’s attention by Linda Raschke.

Notice also that the 875 level roughly coincides with the rising 20 week EMA, which if broken, would set-up a sudden ‘magnet trade’ down to test support at the rising 50 day EMA.  If the EMA support at 865 is broken, then we’ll have to turn to our Fibonacci retracements to find possible support levels.

Beyond the color bars, notice the persistent negative momentum divergence that has formed with price.  That’s bad news for the bulls, but it’s bad news the bulls have been shrugging off for some time – bulls have been wildly resilient in this recent retracement swing up.

Right now, the color bar study is showing caution for the bulls, and the next red bar will appear if the S&P 500 breaks beneath 875.  Let’s continue to watch that level closely.

Corey Rosenbloom, CMT
Afraid to Trade.com

Subscribe to the RSS Afraid to Trade Feed

Follow Corey on Twitter:  http://twitter.com/afraidtotrade Continue Reading…

21 Comments

Robert Prechter’s 40 page eBook on Gold and Silver Available

May 27, 2009: 3:58 PM CST

Elliott Wave International president Robert Prechter recently released a free 40-page ‘eBook’ on the Gold and Silver Markets which is now available for download.

The book covers the following topics:

  • 6 revealing tables, which outline historical performance records for gold and silver vs. stocks and T-notes during each of the 11 recession-expansion cycles of the past 100 years.
  • Long-term analysis of gold stocks.
  • A special section on gold and silver coins.
  • A revealing essay titled “Gold Is Still Money.”
  • EWI’s brand-new Gold Plus Silver Index and how it can help you.
  • An amazing picture of today’s stock market if priced in honest money (gold), like it was in the 1920s.
  • Some of Mr. Prechter’s latest commentary and forecasts for gold and silver.

Mr. Prechter has a unique viewpoint that is slightly in contrast to my long-term technical forecasts (most recent update on the Gold and Dollar market) but it’s worth hearing from various perspectives to form your own analysis and opinion so you can make more intelligent trading and investment decisions.

You’ll be asked to join “Club EWI” for free which I have just discovered and joined which offers many special free educational offers like this one and keeps you informed on tidbits of publications that are available for Club EWI  members (they offer various levels of membership plans across all major markets and stocks – definitely worth studying more).

As a new and proud affiliate member of Elliott Wave International, I am now able to share these reports selectively when they are made available so be sure to stay tuned for more updates as I receive them and get the green light to make them public.

Corey Rosenbloom, CMT
Afraid to Trade.com

Subscribe to the RSS Afraid to Trade Feed

Follow Corey on Twitter:  http://twitter.com/afraidtotrade Continue Reading…

4 Comments

Weekly Comparison Structure of the Dollar and Gold May 27

May 27, 2009: 1:08 PM CST

Per reader request, let’s take a quick look at the US Dollar Index and the Gold Market on a 3-year weekly chart basis, noting key Fibonacci levels and possible long-term targets.

Using Classic Technical Methods, we see that Gold is clearly in an uptrend as confirmed by higher highs and higher lows as well as the current structure of the 20 and 50 EMAs both being above the 200 SMA in the ‘most bullish orientation possible.”

Digging a little deeper, we see a possible Elliott Wave count that notes the Wave (1) was a 5-wave fractal affair and the Wave (2) retracement back into confluence support (50 EMA and 38.2% Fibonacci retracement – drawn inverse) was a 3-wave pullback.  This implies that odds favor a 3rd wave yet to come which – if it materializes – would take prices well beyond the $1,000 barrier.

It doesn’t take deep level analysis to assume that if the critical $1,000 resistance barrier is broken, price has a good chance of forming a trend move much higher.

A new momentum high formed in February which hints that higher prices are yet to come from a ‘momentum principle’ standpoint as well.

I’ve also drawn a confluence Fibonacci grid to note key areas of possible support should price turn down unexpectedly from these levels.  The first ‘line of support’ would be the 20 and 50 week EMAs at roughly $900 and $875.  Beneath that we would have loose confluence Fibonacci at the $840 level and then tighter confluence at the $800 level.

Moving from gold, let’s take a quick look at the US Dollar Index weekly chart. Continue Reading…

10 Comments

US Dollar Index Completes Bear Flag as Expected

May 26, 2009: 12:38 PM CST

The US Dollar Index completed its large-scale Bear Flag on the Daily Chart and I wanted to highlight this development to you and discuss what it might mean going forward.

The Flag began about the $89.00 level (coming off a long and short-term negative momentum divergence at the price highs) and led to the initial thrust lower (breaking EMA support), forming a 45 degree angle clean “abc” retracement (which actually breached the EMAs and violated the “Cradle Crossover” zone just slightly), and then we got the expected move down to fresh 2009 lows at the target area of $80.00.

A flag’s target is obtained by taking the high ($89.00), subtracting the low ($82.50) and then subtracting this value ($6.50) from the top of the flag once we get a breakdown from the rising trendline (at $87.00).  This gave us a rough estimated target of $80.50 which was met and exceeded last week.

I mentioned this Bear Flag three times in the posts:

Bear Flag Breakdown in the US Dollar?,”
Cross-market Comparison of the Dollar, Gold, and Crude Oil – April 26,”
US Dollar Continues its Slide in Bear Flag.”

I think a lot of people picked up on this pattern so it wasn’t a surprise.

Now that the pattern is complete, we have reached a “Technical Decision Node.”  Continue Reading…

4 Comments

17 Week Cycle Observed in the S&P 500

May 26, 2009: 11:45 AM CST

Is there a 17-week cycle operating in the S&P 500? Adam Hewison shares his insights in a recent video which was very interesting to me, as most traders don’t analyze cycles as easily as they do other technical indicators.


(Clicking on the chart opens the video page)

Entitled “Is there a 17-week Cycle in the S&P 500?” Adam shares his observations on the chart above that the S&P market tends to form a key bottom on average 17 weeks apart – a pattern which has held since the market top in 2007.

He notes that we are roughly in week 12 of the cycle, and hints that we might have some downside ahead of us to mark that low.

Specifically, Adam writes:

“I was just looking at the S&P 500 and I noticed a very pronounced cycle in this market that I want to share with you.

In my new video I explain exactly what I’ve seen and what I expect will happen to this market if this cycle continues on track.”

Thank you as always to Adam for sharing this video (with permission).  Market Club members receive all videos the moment they are released.

Corey Rosenbloom, CMT

Afraid to Trade.com Continue Reading…

2 Comments
 Page 508 of 788  « First  ... « 506  507  508  509  510 » ...  Last »