Tsunami's Account Talk

[polarbear]

You do that. I'm still struggling to get into more positive territory. The next three months may be what you and some other people say and I think and hope it will be, about the one time this year to make money in the market before a nice big fat correction sets in. Aha, the high desert, I was there a few times in the mid 70s -- Joshua Tree, 29 Palms, Morongo Valley, and teeny tiny Landers (I seemed to remember it as Lancaster, but I guess it's not) where that nut has stuff in his front yard connecting him in an astronomical / beyondo way with the Universe, and then there was that convention of UFO people who camped out and danced around in a circle and claimed UFOs were attracted to the high desert because of "rock energy" -- they needed it to power their UFOs. And rattlers sunning themselves on the rocks. And lots of druggies living off their crazy money and providing noticeable support thereby to the local economy. Interesting place.

 

[Tsunami]

It's a different kind of high desert over here in Albuquerque Albuquerque Landscapes, but we do get less than 10" of rain per year (and most of it during the July/August monsoon season), and most of the city is over a mile high, so it qualifies technically I suppose.

Looks like the market is finally breaking above resistance at 1874, and there's no better way to do it than to gap over it. Springheel Jack's longstanding target of 1965 for the SPX may be the target Channels and Patterns but it could top lower than that. I'll be watching the waves for clues. It's getting riskier by the day at these levels and a 10% correction will happen once we find that top....but for now I don't think it will be the major "crash" that some expect.

 

[Tsunami]

And just that quick, that jab to a new record high by the S&P, not confirmed by the Dow and totally ignored by the Nasdaq.....looks like that might have been it. Funny thing is, I needed 1882 in the S&P to finally pass another 100K plateau today. I had it for about 5 seconds I think, might hang on for a green close today with options expiration but chicken me just moved to the F fund....and grabbed some QQQ puts near the top.

Looks like the market is finally breaking above resistance at 1874, and there's no better way to do it than to gap over it. Springheel Jack's longstanding target of 1965 for the SPX may be the target Channels and Patterns but it could top lower than that. I'll be watching the waves for clues. It's getting riskier by the day at these levels and a 10% correction will happen once we find that top....but for now I don't think it will be the major "crash" that some expect.

 

[Tsunami]

One after another trend line is breaking. 1850 is a critical area for the bulls to hold. Short term oversold now....So if it's gonna turn up it will be from here.

 

[Tsunami]

Looks like the month-long wave 4 ascending triangle finally completed it's wave e down at 1842 this morning. That panic selloff should provide fuel for the wave 5 rally into the 1900s. I would have gone 100% into stocks yesterday, but since I'd already frittered away my IFT's all I could do was jump out of F and to the lilly pad until 4/1, so I'll miss 4 days of good gains mostly likely. Argh. This all hinges on the morning panic low of 1842 holding though...Ms. Market might want to test that low in next few hours, but so far it doesn't look like it.

 

[Tsunami]

Fear is getting extreme. Down where it was at the early February low. I smell a bottom very near, unless that's a skunk under a neighbor's house.

Fear & Greed Index - Investor Sentiment - CNNMoney

Sentiment Survey Past Results | AAII: The American Association of Individual Investors

Apparently sell in May and go away will be delayed a bit this year.

 

[Tsunami]

Need to post something before I sink to page 3....

Looks to me like there will be one more rally to new highs starting next week (could be more weakness first) in order to completely bankrupt the bears before the real decline starts. That will be right in line with my 1900's by May call months ago. Things are weakening and that correction the bears so desperately want is finally looming...my guess is down to the low 1600's by October.

Meanwhile there's lots of money to be made in miners as wave C of gold's rally gets underway.

Chip Anderson: Martin Pring is Joining StockCharts.com! - Articles - StockCharts.com

 

[airlift]

Need to post something before I sink to page 3....

Looks to me like there will be one more rally to new highs starting next week (could be more weakness first) in order to completely bankrupt the bears before the real decline starts. That will be right in line with my 1900's by May call months ago. Things are weakening and that correction the bears so desperately want is finally looming...my guess is down to the low 1600's by October.

Meanwhile there's lots of money to be made in miners as wave C of gold's rally gets underway.

Chip Anderson: Martin Pring is Joining StockCharts.com! - Articles - StockCharts.com

Tsunami,

I noticed that NUGT closed up @ 38.06 (+2.32) +6.49%. Can you please explain your theory; that is, the factors that make you convinced that there is lots of money to be made in miners as wave C of gold's rally gets underway? What signs or indicators give you the conviction that this is the most likely outcome? I just want to understand this better. Thank you in advance.

 

[Tsunami]

OK, well, here's a couple reasons:

1. For gold the key moving average is the 150dma. GLD tends to either bounce off of it and move higher in bull markets, or bang it's head against it and fall lower in bear markets. See chart #03 here: // [url]www.TTheory.com Public Chart List // - Terrence Laundry - Public ChartList - StockCharts.com[/URL] Also note that recently GLD managed to move above the 150dma. It's on very shaky ground now though trying to hold that. If it succeeds then it's heading higher in wave C of an A-B-C pattern to continue the rally that started with the new year, but if Goldman Sachs and friends get their way and knock gold down below $1100 then that lower low should occur around June/July and provide an even stronger springboard for a rally.

2. Elliott waves. I can't find any free chart at the moment to show, so just have to say that a paid subscription I follow currently projects a wave C up soon that should begin at the same time the S&P 500 rolls over, which should be soon after it tops 1900 I believe, in the next week or so. Until the S&P rolls over and follows other index's that have already topped (small caps, QQQ) and until the theory proves correct gold breaks the other way and shoots above the March highs and there's the bullish crossover of the moving averages GLD - SharpCharts Workbench - StockCharts.com there could still be another low for metals. Many gurus and gold bugs think gold will rocket to new highs, e.g., Peter Schiff's $5000 prediction, but I think another whiff of deflation and the next stock market crash coming in a couple years will prevent that until the 2020's when inflation finally gets going....and the demographic "pig in the python" of the massive retiring baby boomer generation finally works through the system and allows the economy to start growing normally again after about 2022.

3. Just look at commodities in general this year. $CRB - SharpCharts Workbench - StockCharts.com This is shaping up to be a year when commodities and bonds are the winners until the panic low hits, it's risk off until stocks bottom, and I think that will happen in the Fall, a very normal/typical midterm election year....sell in May and go away in 2014, 2018, 2022, etc.

4. Miners are very leveraged to the price of gold so a well-time positioned in JNUG could really pay off, but getting the time right is tough.

Tsunami,

I noticed that NUGT closed up @ 38.06 (+2.32) +6.49%. Can you please explain your theory; that is, the factors that make you convinced that there is lots of money to be made in miners as wave C of gold's rally gets underway? What signs or indicators give you the conviction that this is the most likely outcome? I just want to understand this better. Thank you in advance.

 

[airlift]

OK, well, here's a couple reasons:

1. For gold the key moving average is the 150dma. GLD tends to either bounce off of it and move higher in bull markets, or bang it's head against it and fall lower in bear markets. See chart #03 here: // www.TTheory.com Public Chart List // - Terrence Laundry - Public ChartList - StockCharts.com Also note that recently GLD managed to move above the 150dma. It's on very shaky ground now though trying to hold that. If it succeeds then it's heading higher in wave C of an A-B-C pattern to continue the rally that started with the new year, but if Goldman Sachs and friends get their way and knock gold down below $1100 then that lower low should occur around June/July and provide an even stronger springboard for a rally.

2. Elliott waves. I can't find any free chart at the moment to show, so just have to say that a paid subscription I follow currently projects a wave C up soon that should begin at the same time the S&P 500 rolls over, which should be soon after it tops 1900 I believe, in the next week or so. Until the S&P rolls over and follows other index's that have already topped (small caps, QQQ) and until the theory proves correct gold breaks the other way and shoots above the March highs and there's the bullish crossover of the moving averages GLD - SharpCharts Workbench - StockCharts.com there could still be another low for metals. Many gurus and gold bugs think gold will rocket to new highs, e.g., Peter Schiff's $5000 prediction, but I think another whiff of deflation and the next stock market crash coming in a couple years will prevent that until the 2020's when inflation finally gets going....and the demographic "pig in the python" of the massive retiring baby boomer generation finally works through the system and allows the economy to start growing normally again after about 2022.

3. Just look at commodities in general this year. $CRB - SharpCharts Workbench - StockCharts.com This is shaping up to be a year when commodities and bonds are the winners until the panic low hits, it's risk off until stocks bottom, and I think that will happen in the Fall, a very normal/typical midterm election year....sell in May and go away in 2014, 2018, 2022, etc.

4. Miners are very leveraged to the price of gold so a well-time positioned in JNUG could really pay off, but getting the time right is tough.

Tsunami,

I appreciate your detailed answer. I think this guidance will help others as well. Thanks again.

 

[Tsunami]

OK, this gave me a chuckle, it's almost spooky. The seasonal calendar shows that small caps should typically lose their season edge on about 3/7 each year.
Equity Clock » Seasonality

Well, $RUT peaked a few days earlier but QQQ and the Wilshire 4500 peaked on exactly 3/7/14 this year:
$EMW - SharpCharts Workbench - StockCharts.com :worried:

And I wouldn't be a bit surprised if the S&P 500 both hits a new all-time high and peaks for the year on Monday 5/5/14. Hmmm, too bad it isn't really that easy year after year.

 

[Tsunami]

Well, it wasn't exact but it looks to me like the S&P peaked on 5/13, so only a week after the average date, and it did in fact reach the low 1900's (barely) as I'd predicted.

Now I think the small caps are finally going to drag down the S&P 500 into a 10% correction. So from 1902 that would be down 190 points to around 1712...timing?...who knows, any time between July and October for the low I'll guess.

Who says nobody rings a bell at the top? Ding ding ding ding ding!!!! :cheesy:

OK, this gave me a chuckle, it's almost spooky. The seasonal calendar shows that small caps should typically lose their season edge on about 3/7 each year.
Equity Clock » Seasonality

Well, $RUT peaked a few days earlier but QQQ and the Wilshire 4500 peaked on exactly 3/7/14 this year:
$EMW - SharpCharts Workbench - StockCharts.com :worried:

And I wouldn't be a bit surprised if the S&P 500 both hits a new all-time high and peaks for the year on Monday 5/5/14. Hmmm, too bad it isn't really that easy year after year.

 

[Tsunami]

Springheel Jack has the same target in the low 1700's.

https://twitter.com/shjackcharts
Channels and Patterns
140520-C SPX Weekly 2011-4 Bull Move Patterns Fibs - springheel_jack's library

If that channel holds then the coming correction is just a wave 4, then wave 5 will take the S&P well into the 2000's by 2016.

 

[Tsunami]

No fear. The Greed Index is now over 90, highest in over a year: Fear & Greed Index - Investor Sentiment - CNNMoney

Index's going parabolic: Smart Money Tracker

Looks like an overdue pullback has started with today's peak...but yet another rally into July is quite possible as long as 1920 or so holds.

 

[Tsunami]

Argh, just when I was starting to feel bullish again, stuff like this shows up...

A tweet from Springheel Jack: 2014-06-18_1746 - springheel_jack's library

And add to that list a record level of greed at 94: Fear & Greed Index - Investor Sentiment - CNNMoney

And the fact that the CBOE Equity Put/Call ration is at o.38 today, the lowest daily reading since 1/14/11.

Need a slower grind above 1975 in the next week to eliminate the immediate concerns, but with the Keltner channel at 1960 there's just not much room left. // www.TTheory.com Public Chart List // - Terrence Laundry - Public ChartList - StockCharts.com (2nd chart...and the continuing trend of lower and lower peaks in the volume oscillator in the first chart is concerning as well...at some point it will likely roll over into a sell-off...perhaps to the usual mid-term election year low in October)

:worried:

 

[Birchtree]

You forgot to mention that the VIX sank to 10.61, its lowest reading since February 2007.

 

[Tsunami]

Interesting read from Peter Eliades, he keeps trying and trying to pinpoint a major top...

"we are claiming that today (6-24-14) is a market top. It could well be a market top of great significance."

Consensus Financial Commentary

I think there's a good chance he's right this is a top (with a 10% wave 4 correction to follow), but not the top many fear. What I'd like to know is what day in the year 2016 that upper red trend line and the upper trend line of the green channel in the 3rd chart in his presentation intersect. Somewhere around 2500ish in the summer of 2016 just by eyeballing it (if I wasn't so lazy I suppose I could calculate using his number of 1.12258 points per week for the red line, but then would need to figure out the slope of the green channel...anyone want to do that for me? ). That could be "the" top that produces the next (and last one for decades) major decline.

 

[Tsunami]

I love a challenge. With an assumption that two touches of Peter's upper green trend line were on 4/2/12 and 6/24/14 (giving a slope of 4.69929 points/week, and assuming the S&P 500 will peak right where the upper red and green trend lines intersect, after several iterations I calculate that will occur on 9/22/2016 at 2520. I can live with that, over 28% up from here.

Interesting read from Peter Eliades, he keeps trying and trying to pinpoint a major top...

"we are claiming that today (6-24-14) is a market top. It could well be a market top of great significance."

Consensus Financial Commentary

I think there's a good chance he's right this is a top (with a 10% wave 4 correction to follow), but not the top many fear. What I'd like to know is what day in the year 2016 that upper red trend line and the upper trend line of the green channel in the 3rd chart in his presentation intersect. Somewhere around 2500ish in the summer of 2016 just by eyeballing it (if I wasn't so lazy I suppose I could calculate using his number of 1.12258 points per week for the red line, but then would need to figure out the slope of the green channel...anyone want to do that for me? ). That could be "the" top that produces the next (and last one for decades) major decline.

 

[Tsunami]

This article aligns very well with my big picture expectations, including the very last sentence:
"The next major low in 2016 could be a once in a generation buy opportunity in the US Market."

Dow Jones Secular Bull Market Projection | Trader MC | Safehaven.com

 

[Boghie]

Tsunami,

I am not a chartist, but I see something different in chart two of the analysis you presented. Namely, that something went wrong starting around 1995. The variance - ie. risk - has jumped and the average returns have moved to the right. I would not trust 3 - 5 year slopes. These things look like a mess...