The Euro has had another strong day, but I still think it's getting ready to turn. I've gotten rid of the retracement lines and have left the longer-term fan lines in place. As you can see, these fan lines have implied areas of support and resistance many times over. They are drawn from 10/25/2000 to 7/14/2008.
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Charts of the Day (Harry Boxer)
Originally published on TheTechTrader.com.
The Picture of Vulnerability
Sheesh. The mere rumor of an executive (Tim Cook, pictured herein) from Apple leaving for another company was enough to briefly knock about twenty points from AAPL (and, consequently, the Apple-dependent NASDAQ index). Can you imagine what this stock is going to do on the unhappy day that Jobs either leaves or dies? That one man alone would cause the entire market to crash, if only briefly.
Looks Like Consolidation So Far (by Springheel Jack)
We saw a small move down on SPX in trading hours yesterday, and a sharper move overnight, but this just looks like consolidation so far. If it is consolidation then the support trendline on ES, currently at about 1125, should be respected. That's also the level of the SPX IHS neckline of course:
Bonds have bounced sharply in recent days, and we've seen a perfect 50% retracement of the recent move down on 30 year treasuries. If equities are to rise much further then I'd expect bonds to fall, so these are looking like an interesting short here:
We're seeing some sideways consolidation on USD as well, and on USD, from a technical perspective at least, there seems little reason to expect a bounce in the near future. Looking at the USD currency pairs I'm seeing possible three drives patterns on EURUSD and GBPUSD with the first two drives completed.
Classical three drives devotees will have to forgive my not having been particularly concerned about the fibonacci retracements after the completion of each drive, but the essence of this pattern for me is the formation of three drives of almost equal size. We have that on both of these, and on EURUSD that has formed so far within a broadening ascending wedge:
On GBPUSD we've had two drives within a rising channel. The recent drive has formed a broadening ascending wedge which gives us a rising support trendline currently slightly over 1.575:
These have been big moves on both of these USD currency pairs and if we see a third drive on each then I'd expect that to be in the context of a move up on SPX taking us to the 1175 area. If we are to see that then I'd expect us to chop around today with a slight upward bias before moving up towards 1175 on Wednesday and Thursday this week. If ES breaks support today then I'm doubtful about seeing any move much below 1125 SPX and I'd expect the retracement to conclude by Thursday.
LATE NOTE:
Since writing this ES has bounced back up to 1142.25 and found resistance there. In doing so it has confirmed today's pattern, which is a little broadening descending wedge. I'm expecting us to continue to trade within this until, most likely, it breaks up, which will be a strong signal to go long. Here it is on the ES 15min chart:
By God, It’s That Analog Again
OK, fine, I'm obsessed. It's 11 o'clock in the evening, I really should be in bed, but I keep staring at my freshest take on the 1937-1942 analog. Here's my newly-labeled Past:
And here's my newly-labeled Present:
Some observations:
+ The behavior of the analog from points 0 to 12 is, to me, breathtaking;
+ The behavior from 12 to 17 is still astonishing, but the waves of the Present are more muted than those of the Past; I attribute this to historically unprecedented government intervention. The relationships are still there, but they are somewhat softer.
+ This tells me that point 17 – that is, the high in late April – is not going to be overtaken. S&P 1250 is not going to happen. In fact, if this analog holds, such a figure will not be seen for years.
The big question for me is whether the big drop (circled in red in the Past graph) transpired late in June, or if it still is going to take place. I am not comfortable labeling anything past 17 at this point.
I had said earlier this month that the big drop must have already happened. I'm having second thoughts. I cannot divine how to compare the activity from late April until now with the same chunk of the analog in the late 1930s.
The principal point of this post is to make clear that I am not convinced a drop into the low 900s this year is off the table yet.
