Thursday, October 27, 2011


Sorry I was unable to offer comments the past few days.  Things happen in life that require you drop everything and deal with them.  Reviewing the news the past few days it seems the news out of Europe is about as good as can be expected.  Also, earning reports will start to wind down as we get into November.  So I wonder what will drive the market the next few weeks.  Seems to me it is about as good as we can expect at this time.

Looking at the data I would opine the longer swing cycles have been dominant in the market in October.  I believe I mentioned the 34TD cycle should top this week.  With the open today we well could be setting a top now.   We will see.

Here is the SPX with my interpretation of the cycles:

Gl traders.  My long positions are largely offsetting my "wrong" short positions.  Not a way to make money, but it protects you when your analysis fails you.  So - do your own analysis because I guarantee there will be times I fail to properly interpret the data.


  1. Inlet,
    Sorry for your loss.

    I don't think there is anything wrong with your analysis. Right now, the market are high on booze/drugs due to the news out of Europe. Nothing has actually changed structurally, so, the steam will run out soon.

    When I look at some boring mutual fund-type charts, I think we could run a bit higher yet. The charts still have a bit of room with their RSI's, stochastics, etc before they look overbought.

    Keystone wrote today that the dollar has filled a gap and looks to be near its bottom. Probably will trade sideways for awhile first.

    I have been 3 for 3 with successful trades on EUO (no position now). EUO had lots of gaps on the way up, and many now have been covered on its way back down. I am looking to buy back in should it fall more.

    I'm taking a bath with my SDS calls but not panicking yet.

  2. I expect soon the markets start focusing on the Super committee. Should be good for a few leaks and rumors over the next 3-4 weeks.