Uptrend's Account Talk

[Uptrend]

The money I saved bailing out last week is evaporating Uptrend, QUICKLY! What's your thoughts on the close today? I can't help thinking that helicopter Ben is going to calm the markets with something from his bag of tricks Friday.

We had a momentum shift today and a breakout of the bullish falling wedge I was showing, but still no confirmation from the internals. So no buy signal yet. Further, the VIX is being supported by the 20 ema and is still at scary levels at 35.9. Real deal, or false start is the question. The EW wave count still has not been invalidated as a 5th wave, but we need a turn right here. If it moves any higher, then we either had a truncated 5th wave or we are really in wave 4. I tend to believe that this is a false start, but am open to observing the market, evaluating and modifying accordingly. You must trade what you see. A continuation of the sell signal or a new buy signal will appear in 1-2 trading sessions.

The 1187 -1194 area where the 20 ema is coming in will provide resistance. If this is cleared, an up target is around 1235 and down target still 1096-1040.

It is curious that gold and bonds are selling off for the past 2 sessions. Money flow into the market really wasn't that great today, so where is this money going? Standing aside in cash until Ben Bernake speaks? Just a consolidation?

We also have initial claims tomorrow and 2nd Q GDP on Friday. These might also move the market.

One more thing. Don't feel like you are missing anything, if you have not been in for the last 2 days. This can reverse in a hurry. Still expecting a lower low, but open minded and monitoring the situation.

 

[Uptrend]

Vix Back at 40. Gold and bonds reversal. Fall into the close. Wave 5 underway with c minute wave. Next turn date should be September 2,6 or 7. Cheers.

 

[RealMoneyIssues]

Vix Back at 40. Gold and bonds reversal. Fall into the close. Wave 5 underway with c minute wave. Next turn date should be September 2,6 or 7. Cheers.

But isn't a high VIX something that says we will probably go up tomorrow, even a little?

 

[Uptrend]

But isn't a high VIX something that says we will probably go up tomorrow, even a little?

VIX is a measure of the volatility (fear). A 40 level is about 3% and that can swing up or down. Look at yesterdays SPX price action; 1191-1155. That is a 3.1% spread. Extreme volatility is the sign of the bear. Wild momemtum shifts drive the price action, up or down but within a trend. So far, until it isn't, the trend is down, but may be bottoming somewhat. Wild swings will be part of the process. That is why markets are so exciting, one never knows for sure what to expect.

I am not ruling out a retest of the SPX 1187 area in the morning or a big drop. I don't think the FED is going to do QE3 (inflation risk). The whisper number on GDP is 0.7% for Q2, and that is below expectations at 1.1%. A direction should show up Friday.

 

[RealMoneyIssues]

VIX is a measure of the volatility (fear). A 40 level is about 3% and that can swing up or down. Look at yesterdays SPX price action; 1191-1155. That is a 3.1% spread. Extreme volatility is the sign of the bear. Wild momemtum shifts drive the price action, up or down but within a trend. So far, until it isn't, the trend is down, but may be bottoming somewhat. Wild swings will be part of the process. That is why markets are so exciting, one never knows for sure what to expect.

I am not ruling out a retest of the SPX 1187 area in the morning or a big drop. I don't think the FED is going to do QE3 (inflation risk). The whisper number on GDP is 0.7% for Q2, and that is below expectations at 1.1%. A direction should show up Friday.

Thanks for the info Uptrend. Your analysis is always a great read

 

[jkenjohnson]

I think today is looking like another moderate to big drop. Too much negative news, reduced GDP, unemployment up, world stocks down, no QE3, the list goes on and on. Uptrend, your analysis has been accurate. I will follow your thread more closely in the future. As RealMoneyIssues says - thanks for the information.

 

[PEP]

Its too late for me to take anything out of S so I think I probably should stop checking in every day and see what happens to the account after a few months.

 

[jkenjohnson]

Its too late for me to take anything out of S so I think I probably should stop checking in every day and see what happens to the account after a few months.

Not sure I would do that as it seems we may have further to fall. I won't try to advise you, but I chose to get out and let things settle and plan to get back in later (maybe early September).

 

[jkenjohnson]

Uptrend. What do you think caused the market to jump so much? Not Bernanke. There really isn't any good news data today? What gives?

 

[Dutchy]

JKJ.... Heard commentator say that Markets liked fact FED will meet for 2 days not 1 next month to consider options and tools to use, sounds like a bit of a reach to me.....

 

[nnuut]

No more CE sounds GOOD to me, but they may sneak it in at a later date under a different name.

 

[Warrenlm]

Saw an opinion yesterday that "stealth QE3" is already underway. Using $1.7T of Fed funds through banks to multiply that amount by 10 and involving mortgage securities, repos reverse somethings and other advanced class stuff. Different name indeed.

 

[jkenjohnson]

JKJ.... Heard commentator say that Markets liked fact FED will meet for 2 days not 1 next month to consider options and tools to use, sounds like a bit of a reach to me.....

There has to be something else.

 

[Uptrend]

Uptrend. What do you think caused the market to jump so much? Not Bernanke. There really isn't any good news data today? What gives?

Not sure. Perhaps the fact that the market sees Bernanke won't juice it with QE3, so it can decide? Soothing FED speak? PPT engineered a short squeeze in the moment of indecision?

Will post a chart after the close. Despite the wild upswing rally, the SPX is still within the parameters of the downtrend and bear market criteria, but is sitting on the fence. My other TA information still leads me to believe there are better entry points below in the coming days. No buy signal and I will show why with some chart TA, but want the closing print.

 

[jkenjohnson]

Not sure. Perhaps the fact that the market sees Bernanke won't juice it with QE3, so it can decide? Soothing FED speak? PPT engineered a short squeeze in the moment of indecision?

Will post a chart after the close. Despite the wild upswing rally, the SPX is still within the parameters of the downtrend and bear market criteria, but is sitting on the fence. My other TA information still leads me to believe there are better entry points below in the coming days. No buy signal and I will show why with some chart TA, but want the closing print.

That kinda makes more sense. More QE3 means more money and the potential for inflation, so the market was not wanting QE3 rather than wanting QE3. I was thinking the market was wanting QE3, that's why I am confused. I also agree there is more of a downtrend. I can't get in now anyway, as I am out of IFT's. Looks like 1180 is acting as a resistance line for the S&P. I am looking forward to Spetember, when your charts will possibly provide an entry point.

 

[Uptrend]

Referring to the SPX chart, I think it is note worthy that we have a higher low today, but we do not have a higher high, but rather a lower high. This shows the advance lacks momentum, despite the whipsaw action. This forms a pennant, which can break either way. The market is not done with the whipsawing of indecision. The VIX is also forming a pennant. It ain't over, till its over (the downtrend that is). I am still looking foward to a position trade that goes on about 3 weeks, but the market needs to settle the last wave(s) of the first primary retracement. Still suggesting early September, and that is not opinion, but a TA record of evidence.

 

[Dutchy]

Thanks UT! Great charts. Thanks for sharing your insights.

 

[Happy_Trails]

Uptrend,

Do you consider the MACD indicator at the bottom of the chart in your models? Looks like it has broke to the upside?

Thanks
HT

 

[Uptrend]

Thanks UT! Great charts. Thanks for sharing your insights.

Yes, it is above the 0 line, but with the downward sloping line I have drawn, it could just as easily be a lower high histogram setting up a negative divergence and the next bars roll over. Just saying it is on the watch list.

 

[Uptrend]

Here is the Friday August 26 closing chart in the 15 minute time frame. You can clearly see the weeks price action. As the move extended higher, I re-drew the upper bullish falling wedge line (which is allowed with new information and data points for enough touchpoints). You can see the market closed below. That line is the last stand for the bears. In the bears favor we have a descending triangle in play (lower momentum highs) and in the bulls favor we have an ascending triangle in play (higher lows). They are opposing and hence the tug of war.

Would you be a buyer at these levels, or wait for a better deal (lower close)? With Irene over the week-end, and the VIX still at 36, anything can happen. Waiting for the fireworks next week.