Comments on: Strange SP 500 Confluence Ahead

By: Bob

Bob — Mon, 03 Nov 2008 15:41:29 +0000

what setting are you using for MACD?
same for all timeframes?

By: Anonymous

Anonymous — Fri, 31 Oct 2008 18:30:55 +0000

Well, you got the confirmation today that it is NOT a triangle. A contracting triangle, by definition CANNOT form higher highs and lower lows….

By: Spike1

Spike1 — Fri, 31 Oct 2008 07:04:10 +0000

Take a look at ‘E’ above it’s forming a rare Diamond pattern. I play the SSO and the top to bottom of the diamond is ~3points, so add 3 to any break, if you play by the book it should break down but in these times who knows, be safe and place buy stop above and short below.

By: Richard

Richard — Fri, 31 Oct 2008 05:33:40 +0000

My belief is that the 0.5% funded Bank of Japan currency traders, having taken profit, will continue to short sell a number of currencies, and especially short sell the EUR/JPY, which will cause continued disinvestment globally, which will of course stimulate the S&P to sell off.

Gold is back to the $730 region of a year ago. Is $730, strong support for gold? Tommorrow October 31, will likely tell.

I’ve put my “investment money” far, far away from the current financial system. I recommend that others do likewise, safe and sound in a guarded vault, like BullionVault and GoldMoney, with an account personally at streetTracks Gold Trust, and in physical possession of gold coins.

By: alen

alen — Fri, 31 Oct 2008 00:05:57 +0000

P.S. for all you fundamentalists wave 5 should start the downtrend just as earnings warning season starts. i work in IT for my day job and Sun Microsystems is offering a deal. buy by the end of the year and pay in 2009. we have to buy a new backup system at a total cost of around $60,000 and they are #2 on our list after IBM. Nice accounting gimmick. they recognize the revenue and earnings this year because 2009 probably doesn’t look so good

Only reason IBM is on the list is they are A+ or A- rated on their bonds making them eligible for the Federal Reserve CP program. Sun risks bankruptcy.

By: alen

alen — Fri, 31 Oct 2008 00:01:37 +0000

we could rally to 1050 on the SP and then fall in wave 5. the rally would complete a running flat in EW terms. The 845 low on the SP was just enough to keep the whole thing in an upward tilt.

For the MACD the bulish divergence could last for 2 months. there was one starting in january of this year and the low didn’t come until March for the ABC zig zag and wave 2. the whole theory behind it is that average prices trend up buy you could still get a violent down trend to make a higher low on the MACD and then go into wave 4.

and a wave 5 will be a nice set up for a reverse head and shoulders to start the B wave of this downtrend

By: Anonymous

Anonymous — Thu, 30 Oct 2008 20:28:08 +0000

Well, the simple fact is ‘E’ is greater than your ‘C’ in the dow. Thats not possible for the triangle structure you are postulating. I do think, there was a Ending triangle, which finished in the Oct. 23-28th timeframe and we have already broken out of that. Your ‘A’ on the SP500 is wave 4, by my calculation.

By: anon

anon — Thu, 30 Oct 2008 16:55:49 +0000

Corey, It is a neat analysis. Let’s say the indices move up, what happens to the Elliot wave pattern [because we are talking about completion of 4 waves and will the 5th wave remain incomplete]?

Good point about new president, I think November will be positive. But, with the GDP contracting further, I see Dow registering the lowest in Dec. – remember in the 1987 crash, it was in Dec. we saw the lowest.

Another point – very short term – since the elections are only 3 days away, I guess the present govt.’s PPT is working hard to keep the indices positive everyday. So, I don’t see a big down day for another 10 days atleast between all this.

By: Corey Rosenbloom

Corey Rosenbloom — Thu, 30 Oct 2008 16:51:16 +0000

The structure on the Dow is similar to that of the S&P, both in terms of breaking above the key 20 and 50 EMAs and also breaking out of, and supporting on the upper trendline (unless it needs to be redrawn).

I’m not seeing much difference in the two markets – what am I missing? We could be forming a rectangle, possibly.

By: Anonymous

Anonymous — Thu, 30 Oct 2008 16:26:31 +0000

Try using the descending triangle wave count to Dow Industrials . Dow indicates this is NOT a triangle. Good luck.