February 27th, 2012: Update 1 – Mid-day
Posted by pugsma on February 27, 2012
12:40 pm EST: This has been very tricky area over the past 2 weeks, as local topping areas of the market tend to be. The signs still point to the top of major [3]-P1-C3 being very near at hand per the primary count.
The primary count has been revised to an ending diagonal for minute (5) of minor 5 of major [3]-P1-C3. The drop to 1354.92 this morning was wave iv-(5) and now wave v of (5) of the ED should end near the 1372 pivot. Dropping below this the 1352.28 level will confirm the end of major [3]-P1-C3 and that the major [4]-P1-C3 correction is underway. However conversely, clearing the 1372 pivot area (1372 +/- 7) decisively should lead to the more bullish alternate (blue) count playing out before we see the major [4]-P1-C3 correction.
The alternate (blue) count is that today low of 1354.92 was wave ii-(3) of minor 5 of major [3]-P1-C3. And now wave iii-(3) of minor 5 should end for at least the 1386 pivot area and I have the wave (3) target at 1396, where (3)=1.62*(1). This alternate count should be headed for 1406 to 1426 over the next 2 to 3 weeks to complete major [3]-P1-C3 before we see the major [4]-P1-C3 correction.
SP-500 15-min chart (12:30 pm):
john said
thank you
zeke said
thanks choppy up downs makes it tough
pugsma said
The SP-500 May 2nd, 2011 intra-day high was 1370.58. We just hit 1370.89 intra-day to take out the May 2nd, 2011 high, killing the perma-bears counts yet again.
pugsma said
There is strong negative divergence on the SPX 60-min MACD and RSI(9).
mehmet said
reversed at 88.6 % but this is the third break up test of this level.
Bill S said
Daneric is touting the Ending Diagonal count so probability of that coming to fruition has to be low.
pugsma said
Ending Diagonals are very common in the 5th wave position if long winded bull runs.
Big difference here is Daneric (Prechter) think the market is going to collapse to sub-667 now. And PUG SMA, LLC thinks the coming correction of [4]-P1-C3 leads to another high near at least 1400-1440. Then a significant P2-C3 correction before P3-C3 heads above 1575.
Bill S said
Yes there is a very big distinction between the PUG forecast and Daneric/Prechter axis of incompetence. But it’s just that over the last 3 years I have never seen one single instance of a Daneric Ending Diagonal prediction pan out. I guess there is a first time for everything though
mika009 said
Buffet is saying ” Housing market is near bottom for small homes”. I think thats true coz they can be sold for nearly free. Prices are very depressed.
Also europe is trying to build big firewall of trillions to avoid contagion. Ben Bernanke is ready with his next ammo QE3. China is tightening right now but what is next ” loosen up the policy”. All this will flood money into people’s pocket and markets.
These are few things out of many which makes me think your above 1575 SPX projection will be met and also Daneric will be long by then saying EWT is BS lol
mika009 said
SPX made new highs and NYMO is currently at -11.37 (below friday’s close).
Bill S said
IYR finding support at the 34 day EMA…
http://stockcharts.com/h-sc/ui?s=IYR&p=D&yr=0&mn=3&dy=0&id=p61378781281
Bill S said
I just heard that Prechter sent out an alert this morning calling the rally “terminal”.
pugsma said
Bill S: The only thing I think might be “terminal” is Pretcher’s subscriber count. *vbseg*
ROX said
Is the ED invalid (as labeled) if we move above 1371.56, where v = iii ?
pugsma said
ROX: Wow, I’m impressed. You have been here awhile haven’t you.
Technically, to meet the W1 > W3 > W5 rule of a “contracting Ending diagonal, yes 1371.56 is the wave v-(5) limit in this case. But often times W5 can and will have some “overthrow”. In this case I think an over-throw to the 1376 target area would be allowed. The 1372 pivot range is up to 1379, so that would be about the extent of streching it.
ruscitti said
One other possibility… could be that W3 of the ending diagonal is just completing (as part of an abc) and we would have yet one more move down W4 and one more move up before the diagonal completes.
ROX said
Since Nov 2010! Thanks for clearing that up. More info here if anyone is interested (from your links Steve
).
http://thepatternsite.com/EWDiagTriangle.html
pugsma said
Note that the Bullish Percentage on the SPX ($BPSPX) moved up again last Friday to 85.40. Look at this $BPSPX vs SPX chart covering the past 3 years since the March 2009 low of 667. Do you really want to be buying significally long up there at $BPSPX 85.4? The odds are decidedly against that trade. Even as strong as the market as been, it’s going to crack and form at least a minor top here to complete the major [3]-P1-C3 wave.
http://stockcharts.com/h-sc/ui?s=$BPSPX&p=D&b=1&g=0&id=p11391426412&a=164488777
pugsma said
Another option (which is similar to the alternate (blue) count) is the SPX has been in a minor 4 of major [3]-P1-C3 ascending triangle since the first move to 1367.76 on Tuesday Feb 21st. This mornings drop to 1354.92 was minute (c) of the minor 4 and minute (d) is the run up to 1370.89. We are experience a sligth pull-back for minue (e) of minor 4 now and once complete, a break above 1371 should let to a 19 piont rise to 1390 to 1400 to complete minor 5 of major [3]-P1-C3.
The Russel-2000 really looks like this alternate minor 4 of major [3]-P1-C3 count. consolidation. With a break above 830, it should hit 850 to 860.
Bill S said
I like that count. Would fit with the low volume and negative NYMO. Also the thrust out of the triangle would be powerful enough to cause the last of the stubborn bears to capitulate. Plus the bonus is if we top at 1400 just one point after taking out Prechy’s stop.
pat said
more bear headlines from weekend…
http://www.usatoday.com/money/perfi/stocks/story/2012-02-26/stock-market-bears-doomsayers/53259742/1 bully fuel…
Bill S said
Pat,
Awesome! Thanks for posting that, it is music to a bull’s ears.
pat said
hey Bill
welcome, but im rooting for primary and healthy pullback for now…
Bill S said
Not me. I am rooting for the alternate as the perma-bears are still to confident. I would like to see 1400 SPX to get to the proper capitulation of sentiment.
LarryH said
Another ihs showing up in the last two days measuring to 1383?
Aka2106 said
Apologies if I missed this somewhere but does anyone know what the bottom BB is for Vix? Is there a possibility of a Vix buy equity sell signal here?
Bill S said
16.30 so we are not even close at this point.
pugsma said
Looking like some overthrow here on the primary ED count for v-(5) of minor 5. I’d like to see 1376 tagged before the correction.
pugsma said
Strong negative divergeces 15-min and 60-min chart MACD and RSI(9). Fits well with ED count.
pugsma said
For the primary ED count it would be good to see the $NYMO close below -6.88 here today with the SPX positive again. Further strengthing the negative divergence.
pugsma said
The daily candle is going to look like a potential topping “hanging man” if hit closed positive today. A “hanging man” looks like a “hammer” candle except it occurs near a top versus a bottom.
pugsma said
VIX is putting in a confirmed higher low on this move higher on the SPX showing positive divergence with the SPX, which is actually a negative indicator for the SPX future price movement.
pat said
potential double bottom/cup handle on vxx
http://stockcharts.com/h-sc/ui?s=VXX&p=D&b=5&g=0&id=p75535265713
chrys said
With 15 minutes left $NYMO is a minus 8.5
pat said
does anyone recall friday nymo$ close? tia.
goughman said
it was -6.xx..
chrys said
-6.88
LarryH said
http://stockcharts.com/h-sc/ui?s=$NYMO&p=D&yr=0&mn=6&dy=0&id=p41837801587&cmd=print
pugsma said
That was a very good close for the primary count ED scenario. Even more negative divergences accross the board on all indicators. A BIG drop for the SPX is due based on classic TA and the primary count. We shall see tomorrow…
droc14 said
VIX looks like its trying to get off the mat as well
Silver Bar Tender said
$NYMO closed at -4.99, in the same range it’s been stuck in for days.
$CPCE, the put/call ratio has been sliding back up for 4 or 5 trading days and closed at 0.69 today a very slight uptick – and another divergence with SPX
$Copper continues to chop in a channel much like $NYMO.
All of this seems to me to support the primary count.
droc14 said
that was the change for the day it closed at -11.87
Silver Bar Tender said
You are correct, the final close for $NYMO is -11.87 and the delta for the day is -4.99, so $NYMO remains still in the channel it has been in for multiple trading days. Thanks for the correction.
FWIW I was just looking at HYG the high interest corp. bond ETF and it is firmly into bull territory as this simple Yahoo chart clearly shows (close > 20 SMA > 50 SMA > 200 SMA is a Donchean rule bull call):
http://finance.yahoo.com/q/ta?s=HYG&t=3m&l=off&z=m&q=l&p=b%2Cm200%2Cm50%2Cm20&a=m26-12-9%2Cr14&c=
This chart cannot be of any comfort to bears at all.
LarryH said
http://stockcharts.com/h-sc/ui?s=HYG&p=D&yr=0&mn=5&dy=8&id=p09579308432&a=259097642&cmd=print
A 1.272 butterfly is 91.45.. looks like it is due for a pull back