Sunday, March 15, 2009

Beware Caesar, The Ides of March

Lest we not forget, the major trend is down. Below are Weekly charts that define the primary trend of the market:

The pattern that I posted Friday afternoon still stands. Below is the EW 120 minute chart showing the familiar counter-trend rise against a longer term downtrend:

As one of you pointed out, that False Bar Stochastic is flattening out suggesting the possibility of this small uptrend continuing. But the position of the channels don't allow for much upside before something else, something more bullish, is triggered. On the other hand, a drop now below that rising Wave 4 channel will almost certainly lead to new lows. Unlike Nostradamus, I can't tell which way it will go, but I do know what to do in either case, Up is bullish, Down is bearish and Caesar should have stayed home this fateful day in 44 B.C.

Turning to the Blue Wave Trend Charts, the 2-hour bars allow for some trigger points (reversals are highlighted on price scale and small dashes under trend bars):

Unfortunately, 15 S&P points is a long time to wait for a Sell Signal, so let's look at the 60 minute chart:

Above, a more manageable 10 S&P points, but I think we can do better:

Above is the 30 minute BW chart. It flips SHORT on a six point S&P decline. That should coincide with the break of the Wave 4 channel on the above EW chart. If both systems trigger, it is a high probability SELL SIGNAL.

One last chart. Below is a Weekly Blue Wave Trend Chart. It was posted above alongside the EW chart as my first chart in this post. Here it is isolated by itself because I want to point out the level as of now at which it will turn bullish: 807.10. If the S&P should hit that trigger, everything gets reassessed.


PS: Red Wings 4 Bluejackets 0


Anonymous said...

Am I correct to assume that you believe there is a higher probability that we are still in the downward channel and will fail to break through? Back in Feb, it broke through only to fall back in line with the trend. If I recall correctly, the news then that coincided with this move was Geitner's failure to present a plan to arrest the fall of the financial industry and Obama's plans to spend gobs of money, some of which were for more socialist projects than stimulating the economy.

The news this week is mark-to-market, perhaps more on uptick rule, details on public-private plan to buy up toxic assets, and details about plans to help small businesses. Let's not forget China stirring the pot with concerns over how we're managing our crisis and their exposure to the US dollar.

Let's try something different this time; something to gauge your Nostradamus-ness, if you will. Assuming that we continue the major trend, let's see if we get bad news this week.

Anonymous said...


Ah what the hell. You have been right on just about everything else the last 6-8 months. Can you tell me who your NCAA bball champion is? I need to fill out my bracket.

Oh, and thank you for unselfishly sharing your excellent blog!

John T.

Anonymous said...

UCLA of course ...

Anonymous said...

Woot. Looks like I will be right. And nothing but looking at the fact that the market's been up for the last few days to guess the right action.

Anonymous said...

dude, what is your prediction ???