outlook for week of Aug 24, 2014

I was too cautious in my outlook as the SPX was up about twice my target.  Thought it might over shoot my target and mentioned if we set new highs to consider a position in RWM. Well ^Rut still lagging to upside and no new high (ditto for the DOW).

Looks like we may have reached a short term swing high verified by Friday's failure to close higher than Thursday  See the chart:

May be time to short the market (RWM)  GL traders.

Weekly outlook for Aug 18, 2014

Hard to figure - was the market up/down/sideways last week.  The SPX500 was up about 1%, the Dow just over 1/2% up and R2k was down. As you probably know if you have followed my blog for a while I trade RWM (inverse R2K, R2K down then RWM up).  I guess I can claim to be right by picking one Index, but I generally chart SPX so we were sideways almost (right on no big move) and was looking good mid week, but not so good by week end.  Not exactly as I called it, but close.

This next week we have 3 shorter cycles (1 month, 2 month, 4 month) up with some longer cycles down.  So moving up will encounter some headwinds (longer cycles down and who knows about Ukraine, Iraq, Syria, Hamas, etc.).  From a cycle perspective it looks like mixed during the week as the Market struggles upwards (my guess would be around +20 pts. on SPX500).

Here is a visual:

If we test/exceed old highs might want to trade some RWM?

GL traders.

Outlook for the week of Aug 11, 2014

I felt  the prior week would be mostly flat for the week with possibly a small drop.  It was flat with a small increase. Close, but not a bull's eye hit.  Looking at a short term chart it looks like monthly (lunar -28/29 calendar days) should bottom by Tues 8/11 (+/- 1 day) along with the half cycle (10-11 TDs).  So I see some potential downside in the early week.  By the end of the week the shorter cycles will partially offset the downside pressure of the longer cycles.  So it looks like a flat to down week.

Here is a visual:

 GL traders

Aug monthly and Aug 3, 2014 weekly outlook

I noted in my post (start of 2nd half) the outlook for the remainder of the year.  Expectations were for a pullback into late September.  Too early to say for sure, but the outlook has gotten more negative this past week.  Here is the updated chart for the next few months:

This next week the  2 month cycle should top and turn down resulting in 4 medium length cycles down....  This should more than offset the impact of shorter cycles such as the monthly cycle which is up.  There may be an attempt to rally but any upside should be limited over the next week and shortly after that the monthly cycle will also turn down leading to a negative outlook for August.  In summary - sideways to down this week and then down.  Here is a visual (short term):

FIB target 1 1898...

GL traders

Cycle lengths

I have noted some interest in cycle lengths.  Here is a summary (other sources may list other cycles):

Cycles according to WD Gann:

Thus the 30 year time cycle will be divided into important probable turning points as follows:

1/8 - 3.75 years
1/4 - 7.5 years
1/3 - 10 years and (3/8, 1/2....) so on .

The further divisions of time and price are derived from this master chart as follows:
144*144 = 20,736.

The important divisions are:
Div. Days   Weeks  Months Years
1   20,736  2,962   682    56.8
1/2 10,368  1,481   341    28.4
1/4  5,184    740   170    14.2
1/8  2,592    370    85     7.1
1/16 1,296    185    43     3.55
1/32   648     93    21     1.77
1/64   324     46    11      .89 
GL traders

July 28, 2014 weekly outlook

Overall earnings have looked good, revenues less good...  So far, the market has not responded much to these earnings.  Yes, SPX has set (barely) new highs.  But, the "M" pattern did not develop this past week, but the right leg may still develop over the next couple of days.  See for yourself:

Update 7/30 - With today's GDP report we have had considerable inventory build over the past 3 qtrs (around $200B).   The Kitchin cycle (a longer cycle of around 3.5 years) is sometimes referred to as the inventory cycle.  Once companies get too much inventory they slow down purchases because carrying inventory too long is expensive...  This pullback can lead to a stock market correction.  Here is a visual presentation:

GL traders

July 21, 2014 weekly outlook

Sometimes it helps to look at recent past activity to get an idea of what is happening and the likely future  market.  Here goes:

 

A double top forming an "M" is a fairly common pattern and is formed as shown above.  All inputs considered if the "M" is well formed (not slanted) with even tops and legs what can we conclude?

In the above chart we see the 10 TD cycle contributing most to the pattern. We can conclude that all cycles longer than the 10TD and 20 TD are cancelling each other out.  This cancelling effect generally happens when a trend reversal is in the process of setting up.  So if the pattern completes (right leg down next week) we are looking at an intermediate length trend reversal (possibly)????

July 14, 2014 weekly outlook

The week ahead:

- short term 10TD cycle should bottom  along with 20TD cycle mid week (WED +/- 1 day.  Probably no more than 1% downside over next 2-3 days.

Warren Buffett's favorite measure of over valuation is when the value of the total market index exceeds the GDP.  We have reached that level, so maybe just a matter of  when the market corrects?

GL traders

Update 07/16:

Update 7/17:

July 20 is this Sunday which means if the 2009 bull market top wasn't already seen on 7/3/14 then it should be expected this week.

http://www.safehaven.com/article/34527/lindsay-the-2011-basic-advance

July 7, 2014 weekly outlook

 For the week:

 

Appears 20 TD (1 month cycle) down, and 10 TD (2 week cycle) down...  Longer cycles (15 month, 7.5 month, 3.875 month) cycles down.  The 40 TD (2 month) cycle is up.  Should give us up to 2 weeks down (3%?).

Jul 1, 2014 second half outlook

.............
Normally I look at the market 1-2 weeks ahead (because that is where the normal swing trade takes place).  I took  a long term look early in 2014 (a year ahead and then some very long term charts).

It is time to take a look at the second half of the year.   A 15 month cycle bottomed late June 2013.  So it should bottom again in late Sept along with the 7.5 month cycle and 3.75 month cycle.  Based on the bottom amplitude in late June 2013 I expect the bottom to result in more than 5% pullback (Maybe even a correction (over 10%)).

Currently the market is past the mid-point of the 15 month and 7.5 month cycles resulting in right translation.  This implies considerable downside pressure from these cycles into 3rd week of September.  So I expect the upside from shorter cycles to be greatly neutralized for the next several weeks.

I will try to keep you updated weekly.

GL traders.

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