binve (23.61)

11 Comments – Post Your Own

#1) On October 28, 2009 at 5:20 PM, binve (23.61) wrote:

Who wants a snack? (thanks MissMalibu !!) :)



So here is my count. And I know, I know, in my last post (RUT Broke the Oct 2 Low !!) I said maybe this is P2, maybe not, we will deal with it later.

But with the Russell breaking its Oct Low, this count has increased in possibility (moving away from the other alternate counts) by a huge margin.

So I feel entitled (and very happy) to use it :)



Here is the pattern chart, confirming the bearishness of the move.



So, lets revisit the P2 *confirmation* criteria, from from http://marketthoughtsandanalysis.blogspot.com/2009/10/whew-one-crazy-week-however-i-think.html

The most obvious question is: Did we reach the top (end of P2) last week, or if we have one small wave up next week, will that be the end of P2?

The best answer anyone can give you is: maybe.

That's all. I have opinions and thoughts on this matter, just like any analyst does. But they are irrelevant.

The top will happen when the top will happen. And we will never *know* it is the top when it occurs, we will only know after a confirmation move. What would be a confirmation move? I would like to see a clear impulsive *MINUTE DEGREE* wave down (5 full Minuette degree waves), followed by a 3 wave Minute degree correction with a lower high on all the major indices (SPX, INDU, RUT, COMPQ, and NDX), and then followed by another Minute degree wave down.

I think a move of that size will a) obviously break the 7 month wedge lines and b) be too large to ignore as a bull market correction because c) a 5-3-5 is either a 1-2-3 in an impulse or a zigzag, and I don't see another realistic Minor degree zigzag X-wave to extend this out to be a triple zigzag (I think we are in the 3rd zigzag now by my preferred count).

So thinking about P2 some more, there are a few things that we would expect to see at the end of P2. The final wave of P2 should have:

- Low volume
- Low volatility
- Low breadth and decreasing breadth as it moves up
- Daily divergences of technical indicators (MACD, RSI, and TRIN more importantly)
- Lots of extension with little pullback and possibly a 5th wave extension for a blow-off, not because of a bullish move but because of little bearish resistance.

And so while I am not calling the top here, I am remarking how much this current wave from Oct 2 fits nearly all of the criteria above.

Update 2:51pm

Here is the big count for good measure. Based on Columbia's count several weeks ago: http://ewtrendsandcharts.blogspot.com/2009/10/week-end-thoughts.html.

Thanks for all your awesome work Col !!!

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#2) On October 28, 2009 at 5:42 PM, portefeuille (99.97) wrote:

The S&P 500 index appears to be back at its "trend line".

charts from here.

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#3) On October 28, 2009 at 7:21 PM, anticitrade (99.38) wrote:

At times like this I find myself raising my arms to the heavens and asking: "WHY HAVE YOU FORSAKEN US GOODVIBE!"

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#4) On October 28, 2009 at 8:51 PM, AdirondackFund (27.21) wrote:

Nice BEAR pic binve! 

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#5) On October 29, 2009 at 1:35 PM, Formula51 (< 20) wrote:

Thoughts after today?

 Although the GDP number didn't technically change anything money on the sidelines poored in because the media told the laymen that "all was better". 

If anything the GDP numbers showed how bad the economy really is (minus gov. stimulus of course).  1.7% of the GDP was from autos alone and we already saw domestic auto sales fall from 10.1 to 6.7 million from August to September when Cash for Clunkers ended.

Do you think the media hype of the GDP numbers will be enough to change the direction of a market that was starting to finally realize that companies were reporting less earnings and revenue relative to a year ago regardless if what bogus expectations they may have been beating?  They act like a year ago was some great benchmark.  Does anyone remember how bad things were a year ago today.  If a company is doing worse than a year ago, things are terrible.

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#6) On October 29, 2009 at 1:36 PM, bothisellhigher (55.68) wrote:

Maybe schmaybe-you know darn well we are about to fall off a cliff...it is people like you and GMX and GoodVibe that have prepared the rest of us...and we'll be gliding around with wings attached instead of bouncing off boulders on the way down...thank you once again for a wonderful post!

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#7) On October 29, 2009 at 2:15 PM, binve (23.61) wrote:

anticitrade, LOL!

AdirondackFund, Thanks!,

Formula51,

I put up a new post today that sums up my thoughts on this bounce (and yes I do think it is just a bounce and yest I am still very bearish)

http://marketthoughtsandanalysis.blogspot.com/2009/10/another-look-at-rally-trendline-and.html

If anything the GDP numbers showed how bad the economy really is (minus gov. stimulus of course).  1.7% of the GDP was from autos alone and we already saw domestic auto sales fall from 10.1 to 6.7 million from August to September when Cash for Clunkers ended.

Couldn't agree more. Myself and Mark910 have been making these observations for awhile now.

Thanks for the comment!

bothisellhigher,

Maybe schmaybe-you know darn well we are about to fall off a cliff.

LOL! Yeah, I do. It is not a slam-dunk, but yes, I think the trend has changed. But for those who want to be a little more conservative in their trading, the items in blue are what I would like to see to *confirm* the trend change, but still be close enough to the beginning of P3 to postion and protect yourself.

Thanks for the compliments!!..

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#8) On October 30, 2009 at 5:30 AM, XtremeNeoCon (27.70) wrote:

The news all week was a turd sandwich on dry bread. Everyone scoffed at it, passing it by holding their noses. "Yuk, I'll have none of THAT!"

Thursday comes along and some wise guy pours sugar all over it.

A crowd stares through the window licking their lips. "Wow, that looks pretty sweet. Sign me up for a double order" 

I think I'll pass. A sugar coated turd sandwich is still a turd sandwich. 

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#9) On October 30, 2009 at 10:40 AM, binve (23.61) wrote:

XtremeNeoCon,

I think I'll pass. A sugar coated turd sandwich is still a turd sandwich.

LOL! Yep, I think that about sums it up :)..

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#10) On October 30, 2009 at 1:42 PM, Formula51 (< 20) wrote:

Looks like it was just a bounce.  I really did not expect this big of a sell off today.  I think it really says something about the current situation.  Perhaps investors are finally allowing themselves to see through the bullsh!t.

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#11) On October 30, 2009 at 1:56 PM, biotechmgr (99.54) wrote:

Today is it, 5 waves down confirms a trend change for me. Last chance for longs to get the hell out on next rebound. Sell/short the rallies.

 Speculate (short) only with capital you can afford to lose. We could see system breakdown in the coming depression.

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