SPY Swings

Could this be like last Jul/Aug?

2012-07-12T18:01:00.000-04:00

My Fearless Forecast.

Above was the last chart I posted. Since then we have made it to the lower trend line of the small rising wedge depicted in dotted red.

In fact, today we managed to close below that trend support line as seen in the chart above. General thoughts are for a gap down in the morning then a fill and test of the bottom trend line which has now become trend resistance. The bull case would be a gap up into the wedge and another shot at the upper part of the wedge.

The above chart is my fearless forecast. The circles on the MACD are taken from OGM on the traders-talk->fearless forecast forum. You can find his original post here. Basically I am calling for a similar setup as last years jul/aug timeframe. The pink lines mark the path of the drop, while the green is the rebound. The target area is based on 1.62 * wave 1 (141.48-126.48) which is 24.3. The start of a wave 2 is at 137.8, so the target puts us around 113.5. That puts us in the first support band (the small rectangular area), which was support back at 11/10 and 11/11. Then a theoretical 38.2% retrace up, followed by another 15 SPY points down to somewhere in the 110-107 area. The rebound in green would ultimately trace out the right shoulder of a head and shoulders pattern.

Back in time!

2012-07-04T15:12:00.002-04:00

Soon the market will turn over, we might challenge the highs but will not break them.

SPY is in the blue rising wedge above. I do not expect it to make it to the upper line of the wedge\, though a move to the 140 area is possible in the coming week.

VIX is getting close enough to the lower BB that it will turn back to the 20ma soon. Basically the down turn is upon us, so expect me to be posting a little more :)

HUN for my bro

2012-02-29T15:57:00.002-05:00

3/13/2011 update

2011-03-13T22:26:00.003-04:00

The chart says it all...looks like P3 has started...

Update 02/08/11

2011-02-08T21:44:00.004-05:00

We rebounded off the lower BB on the VIX. This pretty much guarantees that the next couple of days (or rather however long it takes to get to the upper BB) will be down in the market.

The BPSPX:CPC 20ma crossed the 50 going down and the MARKET has still risen! Right now is a tremendous low risk shorting opportunity!

01/30/11 Update

2011-01-30T22:53:00.002-05:00

The VIX move was quite spectacular. We started near the lower BB and finished well above the upper BB. That type of move does not happen often and it does not bode well for the future of the market.
BPSPX:CPC 20ma looks to be curling over. I would short any bounced up on Monday or Tuesday. Confirmation of the move down requires the 20ma to cross the 50ma from above.

01/27/2011 Update

2011-01-27T22:01:00.003-05:00

The VIX visited the lower BB. I expected a retreat to the 20ma, but the move to the lower BB gives more credence that the next 4-5 days will be down in the market.
The 20ma on the BPSPX:CPC has rolled over and the indicator has been going down even as the market has moved to new highs. I think our top is rounded.

01/23/11 Update

2011-01-23T22:32:00.002-05:00

Sitting at the 78% retrace level. It has been a huge march up since last September.
VIX printed a huge white candle. So is it a move back to the MA before a huge move up?
BPSPX:CPC may have turned over. We will need a few more days before we can tell for sure, and even more time before the 20 crosses the 50.

12/29/10 Update....WOW

2010-12-29T19:24:00.002-05:00

Wow...look at that move up from late August, there is barely any retrace. Here we are getting ready to move into the New Year and the market as a whole is peaking out. Volume is dropping, but then again volume is always low around the holidays. We should see a good retrace 1st quarter, but is it a retrace or the beginning of P3 (is it ever gonna come).
VIX spiked much more than the market and is now diverging. Option volatility is now rising as more people buy insurance at these lofty levels. Still its low and no one is really scared.
BPSPX:CPC's 20MA is still pointing straight up. It has managed not to curl over in these past 4 months, which is quite a feat.

12/12/10 Update

2010-12-12T21:50:00.003-05:00

Was that finally a reversal candle on the VIX daily? VIX is in nothing to worry about range...from which typically "Oh craps!" are launched.
I waited a whole week for the BPSPX to turn...and it did not...everyday we maintained above the 20ma. I am looking for a down turn still, but with the holidays upon us this is typically an up/maintain level period.

12/05/10 Update

2010-12-05T22:09:00.003-05:00

SPY looks to have doubled topped with the daily stochs diverging a bit.
VIX looks to be at resistance and looks to be ready to rebound up. Note the trend from mid October in the MACD. Definitely looks like a turn around point.
BPSPX:CPC has been unable to achieve its previous highs. A turn around here is near...as in Monday/this week.

11/14/10 Update

2010-11-14T23:45:00.003-05:00

Look at the sharp drop in the BPSPX:CPC. This is the first time it has cracked the 20ma since mid October. A few more days below and we will confirm a turn in the 20ma and a new downtrend.

11/07/10 Update - To The Moon Alice!

2010-11-07T18:24:00.002-05:00

Ok...a refitted happier green trend line. It does show that there is still a wee bit more to the advance. Looking for the 1228 target mentioned on Thursday. The Honeymooners was in reality before my time, but Ralph always threatened "To the moon Alice!" but he never laid a hand on her as far as I remember :) Alice never made it to the moon...and neither will the market.
We only sit on the outer BB's for so long before we revert back to the mean. If our economy is so good, why is Bernanke initiating all those bond buys? China is to us as we were to Great Britain...The next century will belong to them...for us its going to be a struggle just to maintain status quo.
The next turn in the BPSPX:CPC is going to be the big one. For now its better to stay on the sidelines until we get an indication of the turn.

11/04/10 Update

2010-11-04T23:59:00.002-04:00

Wow, what a move today. While spectacular, volume was not huge. It did however show that P2 has not ended and there may or may not be more of that to come. For the SPX we need to get to 1228.7 for the 62% retrace, we are currently at 1221.06. Note that we are close enough that a turn down tomorrow could end P2, or we could even go to 1381.5 for the 78.6% retrace. A turn down now is dangerous in that it looks like a double top, whats more odds are high for a reversal.
VIX bounced off lower BB, so now you expect it to move to the 20MA.
BPSPX:CPC up considerably but still below a recent high even with todays spectacular move. Need to have it under the 20ma for a few days before we confirm a reversal in the market.

11/01/10 Update

2010-11-01T21:11:00.004-04:00

The market seems to be topping out. The stochs have fallen even though the market has maintained roughly the same level.
The VIX touched the upper BB. I am looking at a retreat to the 20MA and then a push back up to and out of the upper BB. This could easily happen in the same day.
VIX:VXV has finally broken out of its range to the upside. Its been stuck below the dotted red signal line since July.
BPSPX:CPC has no longer been making new highs even though the BPSPX has. Expecting a pull back soon that will bring the BPSPX:CPC below the 20ma.

10/25/10 Update

2010-10-25T21:56:00.002-04:00

Daily stochs are showing strong divergence in SPY.
Today SPY was up and the VIX was up, this typically is not a good sign for the market as the VIX move shows the underlying uncertainty. Yet another divergence pointing to a roll over soon.
BPSPX:CPC was still up, but the rate of change in the 20ma is slowing down. It has yet to rollover, but it is slowing down. Again we must wait for the 20ma to turn over before getting full short again.

10/21/10 Update

2010-10-21T21:41:00.003-04:00

We closed at the lower trend line of the wedge. Tomorrow should be down.
VIX broke the trend and closed below.
BPSPX:CPC was surprisingly down today. Tomorrow should be a down day for the market, but still waiting on indications that we had the top of minor 2 today.

10/19/10 Update

2010-10-19T21:13:00.002-04:00

SPY dropped right out of the wedge. Tomorrow will be interesting. Do we follow through on the drop or manage a recovery.
VIX formed a spinning top, but closed below the red resistance line.
BPSPX:CPC was down sharply, but we will need several closes below the 20ma for it to start curling down.

10/18/10 Update

2010-10-18T21:28:00.003-04:00

The rising wedge shown by the red dotted lines is ending soon. Could it strive for a double top?
Positive divergences in the VIX compared to SPX. This again points to a top being near.
BPSPX:CPC was down today even though the BPSPX was up and the market was up. Still waiting for it to fall below its 20ma before the turn around.

10/11/10 Update

2010-10-11T21:18:00.002-04:00

VIX:VXV made an all time low. It has never been down this far. I thought it was a bad print till I sat down and calculated it out. Hard to see it go much lower, this is a major extreme. A move up in this indicator is a move down in the market usually.
SPY formed a doji star today which is a bearish candle stick formation. Again we are still sitting around waiting for Minor wave 2 to end. Today looks to be it.
Wow, the VIX closed way out of the BB. The BB in the chart above spans two standard deviations and normally is able to encapsulate moves. A move down out of the BB like that hasn't been seen since 2004 in the second quarter.
BPSPX has almost made it to the 70 level. Tomorrow better be a big turn around...but its opex week. Additionally, today was the lowest volume day of the entire years...

10/10/10 Update

2010-10-10T20:09:00.004-04:00

Stoch's still diverging a bit and volume has been down.

The VIX touched the lower BB, now its time for a move to the 20ma and then above.
BPSPX:CPC 20ma has yet to turn, basically waiting for a move in this indicator now.

10/05/10 Update

2010-10-05T21:16:00.004-04:00

Wow, we hit the 78.6% retrace today. If there is a place to turn its now...but then I did say that at the 50% retrace and the 61.8% retrace too...
Ok...was this the proverbial fake out above the upper portion of the rising wedge that proceeds the drop? Or is this the beginning of another leg up? Slow Stochs are diverging a bit, but this can be rectified with a more up days.
VIX is diverging, it is not making new lows with the new highs being made on the indexes. I think this is strongly indicative that people are not confident in these new highs.
BPSPX:CPC also diverging a bit. It was down today even though the market was sharply up.

10/03/10 update

2010-10-03T22:22:00.005-04:00

SPY is staring at the red resistance line almost everyday and just can't get past it.

VIX closed right at the 20MA. Not much I can get from this, it could go either way. The MACD histo is positive which means it VIX is trending up...but the histo is also trending down.

BPSPX:CPC 20 ma has yet to turn which is quite surprising.

Generally still waiting for the market to turn again.

09/29/10 Update

2010-09-29T20:49:00.004-04:00

Looks like we really don't want to pierce that red resistance area. So what point of view do you prescribe to? Coiling up for a move up? or running out of steam from the last move up? My view is the latter as the move has had an upward bias since mid September. Typically a move up is preceded by trading in a channel with a slight downward bias.
VIX closed above the 20MA...
That should be it for the BPSPX:CPC. We will see soon enough.

09/28/10 Update

2010-09-28T20:35:00.002-04:00

We squeaked out a new high but stochs did not. Again we bounced off the red resistance area.
VIX closed at the light blue resistance line which is also where the 20ma ended at, BB's are starting to pinch.
BPSPX:CPC move down a good amount today. One more day at most before a sharp move down.