Wednesday, October 29, 2014

Screen Shot 2014-10-28 at 8.28.05 PMThe power of the FOMC is shown above with 4 trillion dollars on the Fed balance sheet. Today is Fed day and Quantitative Easing (QE) is about to end. Currently there are bullish factors at work with upside breadth being so strong. This could translate into new highs but we’re sticking with choppy – opportunities both long and short.


S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1961.30. 

Screen Shot 2014-10-28 at 8.53.18 PMThe 4 hour SPX is in TD Sell Countdown mode and it has cleared the TDST Resistance at 1968.72. While sticking with a bearish bias, closing above the weekly and monthly outlook thresholds will swing the edge to the upside.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1961.30, same as Short Term Outlook. 

Screen Shot 2014-10-28 at 9.02.46 PMScreen Shot 2014-10-28 at 9.06.49 PMThe Russell 2000 (RUT) is displaying signs that this rally can continue with the recent bar breaching the TDST Resistance at 1146.92. However the SPX should be able to record a TD Sell Setup @9 today, likely under its TDST Resistance at 2010. 40, providing bears some equal billing. At this point, it is best to see what the market provides.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1967.90 on October 31, 2014. 


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Leave a comment

Monday, October 27, 2014

Screen Shot 2014-10-25 at 8.21.56 PMIf there is indicator that is flashing bullish on the S&P 500 (SPX) chart, it’s the McClellan Oscillator which measures market breadth. Generally speaking when the oscillator gets up to 150 level, it signals heavy buying pressure where sustainable rallies are probable. But there are times where plus 150 readings are also categorized as an “all-in” final thrust higher and signals a correction. That interpretation can be applied to the reading in August where the McClellan Oscillator was at a peak and TD indicators were at price exhaustion levels. But the recent situation last week  is different as the +150 readings come off downside TD price exhaustion levels. In the SPX updates below, note the TD Price Flip levels on the weekly and monthly timeframes for the SPX this week. They are all clustered together between 1960 and 1970. Current prognostication is for the market to test the lows but if the weekly SPX turns neutral, market direction will require a rethink.


S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1950.35. 

Screen Shot 2014-10-25 at 8.48.24 PMScreen Shot 2014-10-25 at 8.51.18 PM Equities have rallied sharp enough to place doubt on the bearish picture. Therefore, although the 2 hour SPX is nearing upside price exhaustion and the 4 hour SPX trading just underneath the TDST Resistance, it will be difficult to tell if the next selloff will be just a sharp as the run up.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1941.28, Nasdaq closes below 4419.48 and the RUT closes below 1112.85. 

Screen Shot 2014-10-25 at 8.58.06 PMScreen Shot 2014-10-25 at 9.01.08 PMOn the daily charts, it’s shaping up to look like trading ranges will dominate. Look to see if the Russell 2000 (RUT) can lead, as it is on an unperfected TD Sell Setup. If ‘perfected’ with a higher high, and subsequently price flips bearish, the remaining indices are likely to turn lower with the RUT.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1967.90 on October 31, 2014. 

Screen Shot 2014-10-25 at 9.14.29 PM Screen Shot 2014-10-25 at 9.13.04 PM Screen Shot 2014-10-25 at 9.06.35 PM Screen Shot 2014-10-25 at 9.04.57 PMDespite the strong finish to the week, all the weekly indices are on TD Buy Setups. If any of the indices price flips bullish this week, this will provide additional evidence that markets will remain choppy.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Leave a comment

Monday, October 20, 2014

Screen Shot 2014-10-19 at 10.11.29 PMThe chart above is the monthly S&P 500 (SPX) and the TTM_Squeeze indicator, which represents momentum and the Keltner channel intertwined with the Bollinger Bands. In a normalized trending market, the Bollinger Band will always trade outside the Keltner Channel. This is represented on the TTM_Squeeze indicator as the horizontal green dots. However, what makes this indicator interesting are the red dots. That’s when the Bollinger Bands trade inside the Keltner channel. These occurrences are made possible by low volatility and trading ranges. When the Bollinger/Keltner component flashes a red dot, a potential volatility squeeze is in the works, which can trigger major bull and bear runs. The momentum component of TTM_Squeeze is represented by the vertical histogram. Similar to standard chart reading, momentum readings can come with divergencies. The current prognostication is the SPX is outlining a long term trading range based off the momentum component. It is currently at an extreme, but it has not yet shown any negative divergence. This supports the idea that the SPX will see new highs after it works off the overbought excess.


S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL

Switch back to bearish if SPX closes below 1861.96.

Screen Shot 2014-10-19 at 8.51.00 PMScreen Shot 2014-10-19 at 9.07.08 PMThe short term (and daily) SPX price flipped bullish and now it’s time to attempt to to see if this just a bullish reflex from oversold conditions or something more. If this market is still super bearish, it should not go beyond the 15 and 30 minute TDST Resistance confluence as shown by the 2 hour SPX chart. What is more probable is for the SPX to make an attempt to normalize by at least reaching the top of the down channel as shown on the 4 hour SPX. Observing the TD counts as the market unfolds will help determine market direction.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL

Change back to bearish if SPX closes below 1861.96, same as Short Term Outlook.

Screen Shot 2014-10-19 at 9.19.46 PMExpectations are not high for the SPX to re-start a significant rally, but it could be tradeable.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1982.25 on October 24, 2014. 

Screen Shot 2014-10-19 at 9.33.29 PM Screen Shot 2014-10-19 at 9.34.34 PM Screen Shot 2014-10-19 at 9.36.24 PM Screen Shot 2014-10-19 at 9.37.54 PMOn the weekly charts, expectations are high that TD Buy Setups will be fulfilled on the major indices. Note that all the indices tested their respective TDST Resistance levels and weekly closes below those levels will enhance the probability equities will continue to look for a bottom. Continue watching the Russell 2000 (RUT) as a leading barometer. A weekly bullish price flip above 1119.33 on the RUT can change the landscape from bearish to bullish.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | 1 Comment

Friday, October 17, 2014

Screen Shot 2014-10-16 at 8.07.47 PMOne by one, individual equities are taking out their TDST Support levels. Next in line is Apple (AAPL). It has held up relatively well and should rally when major indices mount a rally. While it would be impressive if Apple can hold above hold its TDST level at 94.74 during the next wave of selling, it’s more likelier to see Apple correlate lower with the Nasdaq.


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Switch to neutral if SPX crosses above 1874.74 (daily bullish price flip) intraday or SPX closes above 1862.53 end of session.

Screen Shot 2014-10-16 at 6.04.13 PM Screen Shot 2014-10-16 at 6.08.46 PMIf the Short Term Outlook switches to neutral today, additional shorting opportunities may come soon if the 2 hour SPX reaches upside price exhaustion or if the 4 hour SPX alternates between price flips in the days ahead.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Change to neutral if SPX closes above 1874.74.

Screen Shot 2014-10-16 at 7.24.44 PM Screen Shot 2014-10-16 at 7.28.49 PM Screen Shot 2014-10-16 at 7.32.25 PMScreen Shot 2014-10-16 at 7.46.38 PMThe current TD Buy Setup can still ‘perfect’ the count with another lower low with bar 8 or 9. But as mentioned in the prior post, there is a good chance it may not happen. Another reason the SPX may not ‘perfect’ the count is the Russell 2000 (RUT). The RUT already price flipped bullish with a follow through day today. This is a good indication the market will stabilize – at least for the near term.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Unless SPX can close above 2010.40, staying bearish.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Tagged | Leave a comment

Thursday, October 16, 2014

Screen Shot 2014-10-15 at 8.44.58 PMThe belief that the CBOE 10 year Treasury Index (TNX) hit a major low back in July 2012 still holds, even with the dramatic move Wednesday morning. From the monthly TNX, the base case remains that rates are still bottoming. The game changer in this equation will be assigned to the TDST Support level at 16.14 or 1.614%. A breach underneath the TDST level will cast doubt in the long term bottom scenario.


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1877.25.

Screen Shot 2014-10-15 at 8.03.01 PM Screen Shot 2014-10-15 at 8.12.07 PMWith TD Buy Countdown nearing a ’13’ on the 2 hour SPX, a full TD Buy Setup ‘9’ on the 4 hour SPX, and the long ‘hanging man’ candlestick pattern on the daily, some kind of bounce is still expected. With the sell off today, and the lack of price exhaustion from the longer duration timeframes, it is far from all-in buy for equities.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Change to neutral if SPX closes above 1906.13

Screen Shot 2014-10-15 at 9.17.11 PMUnless the designated level of 1906.13 breaches to the upside, it is prudent to allow TD Buy Setup, currently on bar ‘7’ guide the way forward. However with the severe morning selloff and the daily candlestick exhibiting a ‘hanging man’ pattern, a ‘perfected’ TD Buy Setup may not occur. If it does occur with another reversal candlestick pattern, we will notch it as a short term bottom.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Unless SPX can close above 2010.40, staying bearish.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Tagged | Leave a comment

Wednesday, October 15, 2014

Screen Shot 2014-10-14 at 8.41.07 PMAnother sense of carnage through Google (GOOG). Google has traded under the TDST Support at 541. This sets the path to lower prices even if GOOG recovers above 541 near term.


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Switch to neutral if SPX trades above 1890.41 at the 2 hour mark from the open or closes above 1874.89 at the close.  

Screen Shot 2014-10-14 at 7.58.36 PMScreen Shot 2014-10-14 at 8.03.06 PMEquities are trying to bounce. Albeit weak, the 2 hour SPX has recorded a bullish price flip, indicating stabilization. The 4 hour SPX has met the minimum for ‘perfection’ as bar 8 of TD Buy Setup has made a true low. With the final bar 9 due to record Wednesday, another dip lower before seeing an oversold bounce, is more than possible.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Change to neutral if SPX closes above 1928.21.

Screen Shot 2014-10-14 at 8.22.53 PM Screen Shot 2014-10-14 at 8.24.59 PMThe daily SPX TD counts are still ongoing. Unless it price flips bullish, further selling still reigns. Also keeping an eye on the Russell 2000 (RUT) in case if the SPX lags. If the RUT price flips bullish, the SPX may soon follow.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Unless SPX can close above 2010.40, staying bearish.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Tagged | Leave a comment

Tuesday, October 14, 2014

Screen Shot 2014-10-13 at 8.06.50 PM Screen Shot 2014-10-13 at 8.22.13 PMA look at a couple of momentum stocks – Netflix (NFLX) and GoPro (GPRO). Both just established TD Buy Setups and both are still trading above their respective TDST Support levels. From a relative basis, the damage to these stocks have been minimal. But if they sell under their TDST levels in the next couple days, this will signal further selling as the TD Buy Setup counts are still in play. A reverse price flip prior to TD Buy Setup ‘9’ will cast doubt on the selling momentum.


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Swing to neutral is SPX closes above 1906.55 on Tuesday’s close.

Screen Shot 2014-10-13 at 2.23.09 PMScreen Shot 2014-10-13 at 2.26.53 PMThe short term structure is now aligned for a bounce. While the 2 hour SPX recorded a ‘perfected ‘9’ TD Buy Setup today, continuous selling on Tuesday can record the final ’13’ for TD Combo Buy at the close. Mesh this with the 4 hour SPX, which can ‘perfect’ a ‘8’ count TD Buy Setup, also at the close. If this outcome becomes true, an oversold bounce can commence on Wednesday.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1928.21, Wednesday’s bullish price flip. 

Screen Shot 2014-10-13 at 2.40.30 PMScreen Shot 2014-10-13 at 2.45.07 PMScreen Shot 2014-10-13 at 6.38.34 PMScreen Shot 2014-10-13 at 6.48.13 PMA view of al the major indices, there is nothing in the TD counts that suggest a more meaningful bounce is coming. While the short term is suggesting a possible rally on Wednesday, selling that rally remains the theme.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Unless SPX can close above 2010.40, staying bearish.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1960.23 on October 31, 2014. 


Posted in Uncategorized | Tagged , | Leave a comment