Posted by: stockscooter | January 1, 2013

Take Off your Party Hat and Put On Bull Horns!

The closer I look at the charts, with my proprietary indicators, the more apt I am to be sprouting bullish horns.  Yes, I know we just went over the fiscal cliff.  However, the powers that be often times wait until the end of the week or the end of the month to make a significant move.  I think we have that as of Monday.  The rather large positive day turned my monthly, first-to-turn oscillator (circled in orange) sideways for the month of December.  With the new month to start tomorrow, another bullish candlestick will turn it green.  This indicator had been down and red since September, as well on other models I use.  This movement is it’s first signs of life.  My trend indicator (circled in light blue) is showing a large spread between lines which indicates strength in the up trend, and with my oscillator about to turn up,  the trend will stay strong to the upside.  This could be very bullish.

Now let’s look at the count. I have developed a bullish count, which is in effect very bullish.  The start of a 3-of-3 could be in the making.  It may have already started last month, or it is in the work-out stages still. No matter, any good upside move from here may be a large 3-of-3 move, which would catch all the bears off-guard.  A third wave at this juncture would be powerful enough as to break the 1442 area on the S&P, which I believe may invalidate the bearish case.  Even a sustained close above 1430 (black line) would be bullish short-term, in which to build upon.  So, the last day of 2012 may well have been very telling.  We shall soon see,  because the market may start to reveal it’s true direction very soon.  A break above 1442 or the more obvious 1474, would indeed have me take off my new years party hat and put on my bull horns.

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Here’s the caveat.  For the past 5 weekly candlesticks, the market has been doing the “Schwarzkopf”.  In honor of the late great General Norman Schwarzkopf, I named this market tendency.  I named it after the general over a decade ago because before he attacked Iran to free Kuwaiti citizens, he maneuvered on the  Iranian border.  Left then right, in then out, again and again until he could see how the Iranian national guard responded.  When he saw the direction of the enemy, the general out-flanked the Iranians and chased them down.  The market has done this maneuvering for 5 weeks (see chart below).  Each week is followed by a large opposite direction candlestick.  This is because a large move is in the making.  Let’s be careful not to get caught positioning before the market breaks.  There should be plenty of return, thereafter, in either case.

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Posted by: stockscooter | December 29, 2012

TIP update

-Spreads are at extremes on my moving averages.

-Strength indicators show divergence via the black trend lines, as prices rise.

-Wave structure could be complete.

-A couple months left until these indicators cross.

-Basic 38.2 fib retrace takes it to 108 area (for starters).

-The rare diagonal triangle pattern usually occurs at the end of a long-term bull market.

-The 3-3-3-3-3 pattern may still need a month or two to complete.  Hard to tell for sure, but it’s close.

-Wave 2 and 4 in the last 5th wave don’t alternate-both are zig-zags (denoting an ending diagonal triangle).

 

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Posted by: stockscooter | December 29, 2012

The Bearish Case – A Closer Look

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Posted by: stockscooter | December 28, 2012

Bull or Bear?

There are 2 probable counts for the S&P 500, currently.  One is bearish and the other is bullish.  Once it resolves, the move will be large. It makes sense that the bearish scenario would play-out.  However, we must never say never to the bull.  Here’s how they look.  The first is a 5-3-5 zig-zag completion for wave 2.  If this is correct, wave 3 down has already begun.  The alternate count shows wave 3 began in October 2011 after an irregular flat A-B-C correction.  For this bullish cont to come to life, we will need a close above the 1442 area.  That would pretty much nullify the bearish case.  Let’s hide and watch and see how this plays out.  Either way, the markets are about to get real interesting.

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Posted by: stockscooter | December 21, 2012

Municipals Started This Flash Crash

Everyone is taken by surprise by the broad equity market flash crash,  The muni market shot the warning over the bow for the past 3 weeks with it’s own version of a flash crash.  Read back on my municipal warning for the national market and the California market in September.Click on the September archives in the right column to read why.

https://stockscooter.wordpress.com/2012/08/15/the-great-municipal-bear-market/

I hope everyone headed my warnings and got out of that trash a few months ago.  I hope I’ve helped alert you to the truth of these current markets, as well.

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Posted by: stockscooter | December 20, 2012

Gold Ain’t Lookin’ Pretty

This is the chart of the week.  Gold breaking down with force.  The pitchfork shows levels of support and resistance, however I have it on this chart to identify the down trend that it’s in, currently.  You have to ask yourself, “Why are precious metals breaking down?”  And, “Why was there a huge short-cover rally in the broad markets?”  Think about it and get back to me with your opinion.

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Posted by: stockscooter | December 6, 2012

The Diagonal Triangle From Hell

Danger! Danger, Will Robinson…Force field in motion.  The force of the TIPS market is still up, but it can’t hold forever.  Actually the diagonal triangle has to resolve by late 2013, where the trend lines cross.   That’s a long time.  But, I’d be wary of alien beings that would want to take it down before then. How over-valued is this market?  If you were to accumulate  all the CPI adjustments since the bottom in 2008 (blue circle on the chart), the yellow line represents full and fair market adjustment.  Anybody buying these at higher prices than that are gonna feel the pain.  If I owned them, I’d be a seller in a big and hurried way.

I only see one thing that will bring down this house of cards. That is another down grade of the U.S. Treasury debt.  Anything else would just bid these up more.  So I suspect the next down grade is in our near future.  These will probably break the lower trend line before they announce it, because the government insiders will already be selling by then.

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Here’s the url for the CPI numbers from the BLS, of which I referred.   ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

Posted by: stockscooter | December 4, 2012

Who’s Junk is Better?

PHK vs. JNK

Pimico’s junk bond ETF (PHK) is under performing (JNK).  Is the Peter Principle in force here? It’s certainly not just end of year pay-outs. Take a look.

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Posted by: stockscooter | December 3, 2012

10 Days of Fear for the Price of 1

California municipal bonds – A picture is worth a thousand words.  Today took-out the last 10 days of buying.  Do you think there may be some concern rising in the near-term? The past 3 weeks seem to be a blow-off top.  Prices seem to project down to the 110 area.  Personally, I don’t think it will stop there.  This may be part of a grand sell-off, based upon revenue imbalances that are pretty severe.

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The next monthly chart shows the blow-off top from a larger perspective.  A 61.80 fib retrace targets 104.  That’s a 12 % correction.  I’m a believer that it would only be an initial wave 1, with multiple years of carnage ahead.  This may be a barometer of the markets as a whole.

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Posted by: stockscooter | November 20, 2012

France to Fall – Oui?

It looks like the France ETF has tough times ahead, which must bode poorly for their country.  Oui?

The chart below has my 3 first-to-turn indicators (blue circles) all turning negative on this monthly chart, encompassing about 7 1/2 years.  The red circle shows a flat-lining trend for this ETF.  Moreover,  the E-wave count is bearish.  It’s set for a possible 3rd wave down, of a third wave down.  It could get ugly really fast.  The decline could reach below decade lows.  Oui?

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