- With the disclaimer being that as an intuitive and more artful TA using inter-market ratio measuring tools and the like, I am the furthest thing from an accomplished cycles analyst. Indeed, I am probably less adept at it than you are.
That behind us, I was fooling around with Stockcharts.com’s cycles tool and came up with this monthly view of the S&P 500, with the thick black lines being a 30 month cycle and the thin green lines being a 12 month cycle, each starting from the 2000 market top.
Each cycle has caught some pretty significant turning points with the 30 mo. having caught the 2000 and 2007 tops along with the 2002 bottom and the pre-corrective 2015 top. The 12 mo. cycle seems to have been more adept at spotting interim turning points but it did catch the 2009 bottom.
So as I’m sure everyone noticed, price sped up a bit this past week. It might have taken some of us (including myself) by surprise, but in the bigger picture, ever since Nov 9th kicked this rally into full gear, price has been fairly relentless ever since. Just take a look at the 100MA deviation envelopes.
The day after the Trump election victory, articles came out on describing how much Buffett made – some $11B, according to this CNBC article published on November 22, 2016.
Thought that was a lot and that it might’ve been too late to buy then?
Well, wait til you hear about how much Buffett made after this past week’s rally. Just look at the size of that December rally compared with the election rally in November in the chart below.
I wasn’t planning a post here today but I have more time than I expected this morning, and I didn’t manage to do the AAPL post I was planning yesterday, so I’m going to combine them both into a single post here this morning.
I’m rolling into the December contract over the weekend, so if you’ve rolled already then I’ve put the spread between the September and December contracts on each of the ES, NQ & TF charts below. All three charts were done and posted last night for subscribers at theartofchart.net.
At the time of writing all the key support levels that I was looking for at the time I did these charts are being tested. ES has made the 61.8% fib retrace and is testing the monthly pivot at 2168 (2161.5 on ES Dec). NQ has made the double double target at 4783, and is now testing the monthly pivot at 4763 (4759 on NQ Dec). TF has made the obvious 38.2% fib retrace at 1249/50 (1245 on TF Dec). These are big support levels, and given the timing on the cycle windows I’m expecting a reversal back up to new highs here.
I’m concluding latin post title week with a phrase which means ‘before all else, be armed’. This market could get very interesting over the next few weeks, hard as that might be to imagine after the last few weeks. We must all be careful not to get caught on the wrong side of a trade that goes the other way hard. The mini-crash almost exactly a year ago followed an August daily band compression that was smaller than this one.
Decent market information is a useful weapon too of course, Stan and I are analysts rather than clairvoyants but on a good day it can be hard to tell one from the other. I’m particularly pleased with this video that I recorded last night for our Daily Video Service subscribers at theartofchart.net, which has given me a very nice morning and a great start to the holiday weekend. I’ll go through the calls on the companion bonus charts below, which were used in the video and then posted for subscribers afterwards. I’ve not included the ES and TF charts as I was mainly relying on the NQ chart for equity index direction, for reasons that should be obvious on the video and chart: (more…)
An S&P 500 heatmap from Friday shows the extent of the Red Sea inspired from across The Pond. However… money flowed into one stock that actually hit new highs. These are great days to isolate equities with concentrated capital chasing alpha.
What better way to celebrate new found volatility than to offset bearish blog bias with bullish resistance ???
Check it out:
The MO MO Trade
For nearly 2 years, waiting for pullbacks, loading, then unloading on measured move highs has been a nice strategy for Altria. Lather, rinse, repeat. Of course, this doesn’t have to last forever, but as long as the higher highs > higher lows trend continues, we’ll stick with it. (more…)
Quite a Friday we had last week, huh? Upon checking my “End of Week” Charts, I noticed some interesting behaviour and thought I’d share my observations. Last weekend sometime, I shared a weekly chart of the US Dollar and that it was approaching its 20 week MA. I use the 20week and 20day moving averages as basic bull/bear filters. I’m only bullish on stocks that are above both and I’m only bearish on stocks that are below both.
I find this makes for an easy and efficient filter. I thought that the US Dollar had reversed short of the test until I saw it after the close Friday and realized it had tested the 20week MA exactly. Take a look. (click any chart for a larger size version)