Tuesday, October 27, 2009

Remember this?


Earlier in the year this chart warned of another leg down in the equity markets that would challenge then exceed the March, 2009 lows. While the index rose 65% from early March, this chart kept me from significant participation in the rally. My bad.

Today the SPX is poised to confirm the Wave 5 Sell Signal by a drop through the rising trend line from early March and the BWT & ATR Sell thresholds. Those levels sit at approximately 1065 for the trend line, 1035 for BWT and 1030 for ATR. A confirmation for any of those thresholds requires a Weekly close below those levels.

Note that any such close this week will likely also trigger a False Bar Stochastic Sell Signal.



A

13 comments:

Anonymous said...

Respectfully, seems as though the $BDI has been ahead of the rally and declines. The trend is now up after being down after July. It is near the 200 day and has a chance to break above the 200 day. If it does, then this may still not be the big wave down. I see you charts and I wrestle with putting other data with it to support your overall view. I don't quite see it...yet. Interesting that the NY summation has been heading south since reaching minimum requirements for a top. You could be right here, $TRANS are not confirming either. Short -term I think a decline is coming, long-term...I just am not quite on your ship, but I am at the dock. I hope I don't miss it if I waffle much more... thanks for your analysis.

sk said...

Alan,
Can you please tell me what the black line is that tracks the price, either above or below it.
Thank you.
sk

Allan said...

sk: ATR indicator/oscillator

sk said...

thank you.
am I mistaken or does this indicator tell you almost every time when the s&P should be bought or sold?
Are there some kind of special setting for this? The ATR in Tradestation is separate from the price action and doesn't give the kind of readings yours does. BTW, when I start making $ with your info you will too.
thanks again.

Allan said...

sk, it is very effective, although not perfect; here is a link to more information and calculations:

http://www.traders.com/documentation/Feedbk_docs/2009/06/tradersTips.html#tt12

sk said...

Allan, thank you. I will chk it out. have to catch a plane.

Anonymous said...

sk, where are you going ???

are you the pilot of that airplane that strayed ???

Anonymous said...

1. Allan said to watch GS, should it break $180. It has and closed below it today and yesterday, i.e., Monday 10/26/09.

2. a lunar cycle is 28 days. Coincidentally, that is the time of a woman's cycle. And it takes 28 days for the average human to form a habit. It is how long alcoholic rehab program is. ... Ergo, try setting the stochastics and the MAvg each to 28 days. Then also set same to 88 days, which is pi x 28. In this way you will get surer sign of what is unfolding.

3. felix qui potuit rerum cognoscere causas

Allan said...

Fortunate he, who was able to learn the causes of things.

Anonymous said...

and..."28 Days Later" was a great movie...

T said...

march 3 = full moon
april 21 = new moon
may 4 = full moon
june 3 = full moon
july 4 = full moon
august 3 = full moon
august 17 = new moon
sept 2 = full moon
sept 21 = new moon
oct 2 = full moon
oct 19 = new moon
............................

All were major reversal points for the whole rally's wave structure.

Next one...very soon, maybe friday october 30,or monday nov. 2 - thru maybe november 5. sometime therein.
black monday nov.2? or a new rally upward?

After that one,comes the new moon around november 18.
.................................
with the current wave action going down these days ,since the oct.19 new moon,it would be logical to anticipate the 'reversal' happening at the full moon,in 3 to 7 days. If youre looking for a bottom support to the current wave down,this is the full moon timing indicator telling ...get ready...could reverse as early as friday oct.30,monday nov. 2,tues nov.3,wed nov.4thurs.nov 5,fri.nov.6.
.................................
My own approach is to combine this indicator with the combination of fibonacci points,trendline, wave structure,and support level....and if "it all comes together" in the 'full moon time period' I look for the reversal to happen.

This is not to take anything away from Allan's trading system.what he's doing looks good. just responding to the previous poster who mentioned the 28 day cycle. the lunar cycle is between 28 and 29 - closer to 29.
I always look at the EMA and SMA 29 on my charts.

T said...

I just wanted to add an observation,from all the charts I'm watching these days... many of them are showing a 'faster rate of decline' in the timing sense,which looks to me like they may hit my target points,the fibs,the MA's,etc. Sooner rather than later ,i.e. in that 'full moon timing period' from oct.30 to nov 5....its making me feel like I want to pull the trigger on friday oct.30.
THIS IS NOT ADVISE . its just my sense of what I'm looking at.

I've decided to expect a reversal at the full moon...if only a small,short term(2 week) move,to the next new moon (nov 17)
If I'm wrong and get whipsawed I'll have tight stops in place.
even if I'm right and the downwave reverses in the coming week,it could still 'reverse' again at the new moon (nov.17 area) so tight stops are in order the whole time.

This past september 17 to 23rd,at that top which broke down hard for a week looked so much like the beginning of the big one...but look what happened.....big reversal ,on the full moon .
this time,I'm expecting it.
instant replay. why? why not.
the whole rally has been doing this.
once or twice is a coincidence.
10 times is a reason to watch for it.

Anonymous said...

Lunar cycles:

Squirrels in captivity can live up to 20 years. Try an EMA of 20.

For all your other investing tips, please refer to www.squirrels.org