Every blog I have read tonight says we are in a triangle and tommorrow should start a big move up – even EWI. Now I think to myself: do 1-2-1-2’s sometimes get confused as diagonals and are triangles often recognized too early. My take, after a margarita and a half carafe of wine, is below. Any move above the high of 3-31 negates this count.
My counts stay the same as last nights post which you can see by clicking here.
A couple of things worth noting:-
(1) What we are seeing is a classic ditribution top. The large institutions that have been on buying frenzy are now starting to offload stock
(2) The number of new NYSE highs peaked a few days ago and is now dropping like a rock. This is usually a sign of a fall.
The only important thing that happened today was that the SP500 broke thru support from the Feb 5 rally. It then spent the majority of the day trying to get above it again. The chart below shows you the whole rally.
This shows you a close up on the past few days
Breaking through a support line like this would normally suggest a decent retracement. I have marked possible retracements on the Rally Chart. In this Groundhog Day Rally thoughit may just spend every day trying to get back above support again. I will be watching closely.
ApartOfNY is proud to add the Linkus Hub, or “The Hub” to our menu bar. Please check it out .
The LinkUs Hub was started by GoodVibe Market Vibes, or GV, and is a great place to share and learn about trading. A couple of comments on the hub from Gv’s site are:
What is “LinkUs Hub” or “The Hub”?
“The Hub” is one of a kind financial discussion-room where our fellowship of traders and investors gather and communicate LIVE with each other 24×7 to discuss all things related to the market. We post our contributions for others to read when they also stop by later to drop their own work. Others will come later to do the same thing in a free flow of information.
What “The Hub” is NOT?
We don’t do chitchat. No empty debates either. Long useless talk? Nope! Unverified claims? Nada! Unreliable analysis? Zip! Unsupported opinions? Zero! Emotional baggage? Hell no! Whining? Never! Bragging. No chance! Immature behavior. Never! Personal attacks? On our DEAD bodies. Herd mentality. Not anytime we checked! 
So try it out. The Hub’s mission statement is “Share, Learn and Grow”.
One fairly Bearish perspective on the market is illustrated in the chart below. Not that it matters Apple will still probably go to $2000 a share and BIDU to $1,000,000 and a loaf of bread to $2,000,000. Maybe I am becoming a little cynical.
Has been climbing the wall of worry very successfully lately. My latest chart tells me that it is ready for another big move. The trouble is I don’t know if it is upto 700+ or down to 600- even though I think it might start to crawl down the arc.
Every day seems to be the same to the point where I’m starting to think I’m Bill Murray, the weatherman from Groundhog day. The Market gaps up, sells off on volume, then crawls back up again on no volume. Today was pretty much flat and much of it was spent on the support line of the Feb 5 rally.
Before the counts I’ll show a very simple chart, which shows the support line of the Feb 5 rally and the 3 attempts to break out of it. Generally the 3rd or 4th attempt is where it breaks.
Wednesday and Thursday will probably be groundhog day 2 , “The revenge of the window dressers”, and Groundhog day 3, “The return from the sidelines ”. Over to the counts where nothing has really changed. I still favour the bear charts, however anything can happen in this tortoise rally.
Daily
Hourly
Daily
Hourly highest probability
Hourly Best Alternative
Good luck in your trading endeavours.
Here is an updated Monthly on the Nasdaq. I have added a fib retracement from the Sep 1995 start of the diagonal to the Oct 2007. We re now sitting at the 23.6% retracement and just above the Diagonal resistance line (wave 4’s have throwovers). After the monthly chart I’ll show you the hourly close-up.
And the close up
I’ll continue to monitor this.
Sometimes it is not worth getting out of bed in the morning. New York today was a little like that. A miserable weather day and a boring market day. Another gap-up on a very low volume day, which may be the highest volume of the week. The “Tortoise rally”, as CNBC continues to irritatingly call it, wants to continue drifting higher and higher with less and less participation as it goes along. Today’s action also was very triangular, which suggests that the market is searching for direction.
I still favour the Bear Count. Saying that these low volume weeks can sometimes have very misleading movements, which is why they are often best spent on the sidelines. Over to the updated counts:
The daily
The highest probability hourly
The best Alternative hourly
The daily
The highest probability hourly.
I have added “The Ultimate Oscillator” to my trading chart. Below is the Updated Russell 2000 Trading Chart.
So what is the Ultimate Oscilator, I hear you ask?
Developed by Larry Williams and first described in a 1985 article for Technical Analysis of Stocks and Commodities magazine, the “Ultimate” Oscillator combines a stock’s price action during three different time frames into one bounded oscillator. Values range from 0 to 100 with 50 as the center line. Oversold territory exists below 30 and overbought territory extends from 70 to 100.
The Ultimate Oscillator can be used on intraday, daily, weekly or monthly data. The time frame and number of periods used can vary according to desired sensitivity and the characteristics of the individual security.
It is important to remember that overbought does not necessarily imply time to sell and oversold does not necessarily imply time to buy. A security can be in a downtrend, become oversold and remain oversold as the price continues to trend lower. Once a security becomes overbought or oversold, traders should wait for a signal that a price reversal has occurred. One method might be to wait for the oscillator to cross above or below -50 for confirmation. Price reversal confirmation can also be accomplished by using other indicators or aspects of technical analysis in conjunction with the Ultimate oscillator.
The Calculation is:
Uo = ( 4*Bp(1)/Tr(1) + 2*Bp(2)/Tr(2) + Bp(3)/Tr(3) ) / 7
where:
Tl = min (L, Cp)
Bp = C – Tl
Tr = max (H-L, H-Cp, Cp-L)
Bp(i) = Sum of Bp for period i (1,2,3)
Tr(i) = Sum of TR for period i (1,2,3)
L = Period Low
H = Period High
C = Period Close
Cp = Previous Period Close
Definitions:
Tl = True Low
Bp = Buying Pressure
Tr = True Range
Uo = Ultimate Oscillator
The Ultimate Oscillator is calculated for 3 different time frames which are weighted at a ratio of 4xShort/2xMedium/1xLong. The weighting is the reason for both the 400, 200 and 100 multipliers and the /7 at the end of the formula.
Hat Tip to Anchak, on the calculation details.
[Update at 3:41pm: I have added the 20 Month MA to the Nasdaq Composite chart, as that would be a good point for the bounce to occur. ]
One of the things that has been troubling me about the major US indices is that, although it looks like we bottomed on March 9, a lot of the Market leaders (e.g. AMZN, GS) appeared to bottom in November. This is also true of several of the global indices. I have been wondering if we saw an irregular bottom. I have tried to put some counts together to show this.
First the Russell 2000
Now the Dow Industrials
Also I wanted to update the contracting diagonal count on the Nasdaq
And give you a close up
And completely unrelated, some sugar
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