Sep 25, 2021

Weekly preview

It took one more day with sharp sell off and we have the expected low, which should be 10w low. Now the indices are heading higher for at least 5w high - we have one week up and we should see one more(the two weeks up, which I was talking about in the comments).

Below I am speculating that this could be something much more than 5w high. In the last several months we are seeing long topping process and I think the indices are close to 4 year cycle high which begun in Jan.2018. When pattern/cycles are not very clear it helps to look at other indices especially such, which are not so heavily manipulated with a few big stocks. Example is value line geometric index - An equally weighted price index of all stocks covered in The Value Line Investment Survey.


TRADING
Trading trigger - buy signal.
Analysis - sell the rips, long topping process.

P.S. - for a trade both analysis and trigger should point in the same direction.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - a-b-c lower, now waiting to see the move up.... it will be another zig-zag for sure. The question is how high, according to cycles it is not over.


Intermediate term - from the March low we have one big zig-zag consisting of two zig-zags, which itself consist of zig-zags. You can call it W-X-Y, but there is no impulses.
Waiting to see how the next high will look like just test of the broken trend line or something more. We have some technical damage weekly RSI breaking the trend line and VIX breaking the trend line connecting the highs from the March.2020 low. This are the first signs that the tide is turning.


Long term - topping process running for months and maturing. Some kind of b-wave and c-wave will follow.


MARKET BREADTH INDICATORS
Market Breadth Indicators - oscillators turned up. There is no signs for important low, but according cycles it has the potential to last for 1-2 weeks.
McClellan Oscillator - around zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - sell signal.
Bullish Percentage - turned up, in the midle of the range.
Percent of Stocks above MA50 - turned up, in the midle of the range.
Fear Indicator VIX - broke the trend line from the March.2020 top and now retracing.
Advance-Decline Issues - in the midle of the range.


HURST CYCLES
Short term cycles - we saw most likely 10w low and heading higher into at least 5w high which has the potential to be something much more than that.
From the last high this is the third week for the 5w cycle high lasting usually 4 weeks. 9+6 trading days for the two 20d cycles. The usual length is between 9-13 days so at least the second half of next week and it could stretch until 4th-5th of October.


Week 9 for the 20w cycle.
I think this index shows more clear what is going on. Roughly every 4 months you have 20 week high/low as it should be.
The lows are the same like SP500, just the July low is clear defined with 5-6 weeks decline and for SP500 I have compared many indices and used some indicators to identify it - looking only at the chart you will see nothing.
The highs - the previous and the current 20w highs look clear defined and the overall flow high-low is clear and well visible. So the next high should be important at least 20w cycle high.
Short term - https://schrts.co/EeIrtdzN From the June high on every first or second of the month we have 5w high now the fourth 5w cycle running and the first two trading days of October are 1st and 4th, which is the same like the calculations above.
Long term - https://schrts.co/QGysPmWw It all begun in Jan.2018, the 2020 high is nothing more than a b-wave and I think we are at 4 year cycle high. Visually it divides better as two 2y cycles. If you stick to Hurst rules and divide it in three the second 18m high was in early June 2020 and 16 months later right on schedule the third 18m high.

Sep 18, 2021

Weekly preview

Tricky price action... it looks slow but every pop is hammered... it broke important trend line but it is at support MA50... it could be an impulse lower but crappy one you can not be sure.

We have some change in price behavior not a big decline but long - we had only once so long decline this year in February. This should mean we have a decline of the same degree or 20w low and this is what should happen after 20w high - 4 month between the last two highs May-September.
Market breadth does not show signs for a pending low or reversal, it is taking a lot of time 10 days already so close to 20d high. My best guess is based on short term cycles - I think we had 20 low on Tuesday and now sideways pattern probably triangle is running for 20d high.


TRADING
Trading trigger - sell signal. The price is below MA10 and hesitates to rally above it.
Analysis - sell the rips, long topping process.

P.S. - for a trade both analysis and trigger should point in the same direction.


TECHNICAL PICTURE and ELLIOTT WAVES
Short term - still not very clear... crappy impulse wave 1 or a-wave and now in 2/b sideways move completed around FOMC. Less likely continuation lower for c-wave.


Intermediate term - from the March low we have one big zig-zag consisting of two zig-zags, which itself consist of zig-zags. You can call it W-X-Y, but there is no impulses.
Waiting for more price action to confirm intermediate term top. This time the price is struggling at MA50. All the previous 7 occasions were clear - touch and strong up, now it takes days and nothing happens.


Long term - topping process running for months and maturing. Some kind of b-wave and c-wave will follow.


MARKET BREADTH INDICATORS
Market Breadth Indicators - nothing new, I do not see a sign for a pending low and reversal.
McClellan Oscillator - below zero.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - buy signal.
Bullish Percentage - pointing lower.
Percent of Stocks above MA50 - pointing lower.
Fear Indicator VIX - preparing for a spike higher?
Advance-Decline Issues - heading lower.


HURST CYCLES
Short term cycles - 20d/5w low was expected this week. I think it was on Tuesday alternate Friday or early next week. Now we are watching for 20d high already at day 10 so it should not last long probably mid next week FOMC.
In the bullish case wee should see 1,5-2 weeks higher(green). In the bearish case the price continues lower and we have consecutive lower highs for the 20d and the 5w highs(red).
It is spending a lot of time below MA10 so with every day the bearish scenarios is getting more likely.


Week 8 for the 20w cycle? You can see how every time we see decline into 20w low RSI crosses below the MA, three times in a row and this is the fourth time - this is a hint that a decline into 20w low is underway.
The long term count is not very clear, there is no visible significant low, the indices do not show consistent picture so we will be sure only in hindsight where the 18m low is. Two options:
- bullish 40w/18m cycle low in September/early October with one extra 10w cycle for the missing one from 2020.
- bearish the 18m low was in July which means to expect decline into 20w low until November. NDX,NYSE,DAX,RUT,DJT have lows in July so this is the low to pick for possible 18m low.... only DJ have the low in June.