Uptrend's Account Talk

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Market appears to be at a turning point this AM; meets time projections. Appears to me to be start of the major B wave down of primary wave B (of bear market ABC). I know, I missed the very profitable major A wave, but better to be safe than chase. Also, the market has now partially shown it's hand. Based on the 1257 top, I am projecting SPX 1187 - 1144 as the turn point for the start of major wave C. Some say that major wave B has already occurred and we would now be topping wave C and then starting primary wave C, but that does not line up with my analysis. Major wave C could attain SPX 1330-1370 (or even higher), before rolling over.

Bonds are waking up. I see a +1-2% trade in the next week. That is a guess, based on the structure of the set-up.
 
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Originally Posted by Khotso
UP, check out this link. I'm wondering how this aligns with your EW projections -- seems to me like it reflects your projections quite well, but what do I know? Wave theory is about patterns, analog theory is as well? Just wondering. :rolleyes:

http://pragcap.com/1946-analog-holds...current-market

jkenjohnson said:
I'm not knocking your post, but I would think that if you looked at the various patterns over the past 75 years or so, you could find just about anything you want to match todays market. These people are guessing and that is all. But I guess we'll soon find out.
Click to expand...

Understatement: The markets can really be confounding! This October rally -- especially this past week -- has been incredible. It's really discouraging to have sat it out waiting for a deeper drop in order to get in and stay in into November -- despite having two IFTs to play with. I think I overthink things.
Coulda-Woulda-Shoulda -- a month or so ago I posted this link (see above) from Pragmatic Capitalist about an analog comparing current price action to 1946. I've always believed that analogs are very useful tools in many ways and arenas. Why didn't I go with my gut and go in on Oct 21st based on the analog? Kick me, please.
Lessons Learned -- The markets can really be confounding! Sometimes you've got to stop thinking and go with your gut.
The Silver Lining -- I didn't lose any money, I learned a lot -- about markets and investment psychology, and there's always another day!

Uptrend -- hope you don't mind me borrowing your thread.
 
Live and learn. Believe it or not, I did see the start of the fantastic October rally and my system flashed a buy on October 5th, but I did not trust it, so did not post or follow. That was a huge costly mistake. But life is about learning and not being swayed by ones emotions, regardless what you may think of the market environment. Also contributing was caring for my spouse, which was in the hospital for 3 days in that timeframe, so my attention was elsewhere.

Backtesting reveals seven buy signals (other than the F fund) for the trading year to date, for my uptrend system, with a yield of over 30%.

Today put the outlook favorable for shorts in the market. For SPX, I am watching the following levels. 1241, 1209, 1187, and 1158. Possible turn dates might be tomorrow (Nov 1), or Nov 9 or even a little later. I am favoring the Nov 9th turn date, and the SPX 1187 level, but the market action will tell the story. This could be the start of primary wave II, major wave B, but could also be a continuation of major wave A.

The F trade (bonds) looks solid at this time. The US dollar wants to rally, and this is another reason I think the market may be starting major wave B, a correction wave, before finishing the year to equal or new highs. This would be a double top.
 
Thanks everyone for your kind words. A buy signal has appeared; at least for the C & S funds today. Not sure I like it, but the signal is there, so I moved 30% C and 70% S. A minimum fibonacci retracement from SPX 1293 was just shy of the 0.382, so the B wave appears to be completed. Now a run to the highs.
 
Uptrend said:
Thanks everyone for your kind words. A buy signal has appeared; at least for the C & S funds today. Not sure I like it, but the signal is there, so I moved 30% C and 70% S. A minimum fibonacci retracement from SPX 1293 was just shy of the 0.382, so the B wave appears to be completed. Now a run to the highs.
Click to expand...
Thanks Uptrend I hope I have a headstart and now may put more in soon if the 1260 is broken.
 
Bquat said:
Thanks Uptrend I hope I have a headstart and now may put more in soon if the 1260 is broken.
Click to expand...
Is 1261.15 close with 1263.21 high enough of a break for you? I hope it is complete confirmation but am willing to take a little hit in the next couple of days, on lighter volume, to build a solid base before a climb.
 
Here is a bull case; based on the weekly SPX chart. Not saying I believe it; but nevertheless it is shown for consideration. Today many buy signals flashed all over the charts. The market seems to want to go higher.

According to David Petch, we may see a stock market top in 2013, after some weakness in early 2012. He explains this as a reverse fibonacci spiral. What the heck you say?! If you are technically inclined, you will love this stuff; otherwise you will hate it. Anyway if he is right, my chart shown is not that farfetched.

http://www.financialsense.com/contr...fibonacci-spiral-point-of-singularity-in-2019

2011-11-03-SPXW1.jpg
 
Regarding my last post (#2234); if we are still in a bull market, then the ABC bear primary wave layout does not apply. Bull markets are 5 wave advances. So the previous wave from SPX 1370 to 1074 may have been an X wave and now we start a 5 wave advance. Further each wave would subdivide into 5 waves. So, we could be on primary wave 1 and major wave 3 (major wave 1 1074 -1093, 219 points, major wave 2 1093 -1215, 78 points, and major wave 3 underway). Quite often wave 3 is the longest, although wave 1 may have been the longest in this advance sequence. The wave I am calling C in post #2234 may have the 1350 to 1569 targets and is major wave 3 in this scenario.

A pullback in early 2012 that David Petch is calling for, may be primary wave 2 for this bull scenario. Waves 2 and 4 partly retrace the advance.
 
The market is still holding some important technical levels, but need to turn right here. A buy is still in play, and is a better entry point than I got yesterday.
 
Uptrend said:
The market is still holding some important technical levels, but need to turn right here. A buy is still in play, and is a better entry point than I got yesterday.
Click to expand...

Technically it may be, but what if something completely unexpected happens over the weekend, then all bets are off....There are just so many things teetering on the edge of a cliff to think of this market rationally!
 
The question is, how much of the edge of a cliff stuff is already priced in? We obviously can't anticipate surprises, but is anyone really confident about Europe or our super committee's ability to get something done with our debt situation? Probably not, so much of the negatives may be priced in. Stocks are actually very cheap but as you said, unexpected news can still move the market.

I have no idea what will happen, but nervousness and all, I am seeing a glimmer of hope for stocks as long as that 200-day EMA holds on the S&P. That's where I would put the edge of the cliff. :)
 
It looks like, based on that guy's Q ratio, the market hasn't been undervalued since the 1980's. That's a little too macro for me.

I'm not a fundamentals guy, but last I heard the 2012 forward P/E on the S&P is in the neighborhood of 11-12. That's not bad. The Naz 100 is closer to 13-14 - very good actually for a mostly growth index. I will double check these.

Of course the P/E can go up if earnings come down and the price stays the same, so it depends on the economic forecasts too.

Since we look mostly short-term, I am more concerned with sentiment (yes, a little too much bullishness recently) and how under invested money managers are (panic buying to pad the books) as we head into the strongest part of the year. Valuations are of little concern in that case.

If I move into the G fund next week my story will be different. :D It all depends on the charts.

Update: I found this chart which goes into Sep 2011...

SnPpe2011923834small.jpg


Full size = http://www.istockanalyst.com/images/articles/SnPpe2011923834.jpg
 
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