Can the Mess in DC affect the cycles? I would think so in the short term (a few days), but longer term the cycles will follow their natural course. One thing is fairly certain, unless we get some resolution (like - kick the can) volatility will increase. I suspect any short term agreement of 2-3 months will weigh on the market adding to any natural cyclic down turn (which I believe will start around mid October).
First though any agreement (even short term) would probably boost the market for a week or so. Don't forget earnings season is upon us. Appears the eateries are missing (5 of 5 last week), two large banks looked less than robust and it appears Penny's is into heavy discounting which is impacting retailers (Gap, Fitch, etc.),
I noticed also California had installed a new computer system for unemployment claims and had under reported claims for the last few weeks by about 15,000 a week - so the unemployment claims numbers in September looked good but were garbage.
It is my opinion we have several factors converging that could give us a 10-15% correction by the end of the year. In the meantime next week should be up 1 % or so.
Here is a visual:
The one thing I am wondering about, what if we're holding in the 1740/60 zone, in early November?
ReplyDeleteYour cycles would suggest another wave of upward pressure into December (Santa rally?).
Regardless..always good to see a new post from you. Have a good weekend.
Possibly, but there is a 13.5 month cycle (1/3 Kitchin ) that should bottom toward the end of the year that has the potential to extend any downturn into late December or early January. Often with longer cycles we see the greatest downside pressure in the last 12-15% of the time span.
DeleteHi the Inlet, If there is no possibility of the Rally until 28/10?
ReplyDeleteI think the existence of cycles of Fullmoon + eclipse rally will continue until the date 28/10
DeleteSandiawan - I try to tell you what I believe is the most likely outcome. According to the lunar (23TD) cycle we should rally into Fri (10/18) or early the next week(10/21) which is the new moon. External activities may (DC?) impact outcomes.
DeleteThanks a lot bro, I look forward to October being the month of surprise.Gbu
DeleteHints of a top:
ReplyDelete1) Price/revenue 1.54 multiple (almost double historic norm)
2) Cape (10 yr avg ) PE - 24.2 (high)
3) GDP and final sales - year-over-year growth is already below the levels at which recessions have typically started. (1.64)
How do your predictions after 21? Whether the rally will continue or down?
ReplyDeleteI expect the last half of October to be down.
ReplyDeleteOk.Tq very much,God bless u
DeleteTo add further color into expectations for late Oct 2013: there is a solar eclipse Nov 3 (Sun) and as mentioned above the lunar eclipse on Oct 18. High probability of a modest correction (not crash) in the lunar red period leading into the solar eclipse date since such periods have negative expectations.
ReplyDeleteAlso the third and final Mercury Max cycle began Oct 9, 2013 and goes retrograde on Oct 21 and inferior conjunct with sun on Nov 1 and officially ends on Nov 18. The final Mercury Max cycle that occurred late 2012 made a relative high 21 days prior to the start date then dropped to a lower low on the start date, rallied modestly on retrograde date, then a big drop of -8% into the day before the inferior conjuct date that resulted in a significant bullish reversal on the actual inf conjuct day.
So far this year we made a relative high on Sep 18 (21 days prior to start date) and then dropped to lower low on start date of Oct 9. We now observe and expect a modest bounce heading into the Oct 21 retrograde date which appears to be also intact. I assume a temporary debt ceiling deal by deadline day will provide an euphoric one or two day rally into Oct 18, 21. If the markets should decline into Halloween then expectations are for a correction exceeding 5% from the high of Oct 21.
@Awakening888: thank a lot,Ok 18-21 up, if you see a stronger after 21 up or down?
ReplyDeleteHonestly I am very confused directions 22-28 oct, whether Up or Down,I hope you can help me.tq.Gbu
DeleteLooks like SPX hit my expected highs. I don't see that anything of significance changed in DC (a can kick). We may test old highs (about 1% higher) but my projections say we set a lower high. I guess earnings will decide that?
DeleteTechnically speaking, SPX can rally into the resistance uptrend line formed from the May/Aug/Sep tops, and into the mid-late Oct period would be around 1745. As I type it hit 1742 today and assuming next day (Mon) it hits 1745 then it would have rallied 100 points in just 9 TD's or 8 TD's if it spikes up later this afternoon! That would be quicker than the most recent 100 point rally from Sep 6 to 19.
DeleteIt is always difficult to forecast how it plays out near term but if one is contrarian then we are getting very close to a possible short term reversal/correction. One could set up a trade with very low risk setting a stop around 1750-1760 if an entry could be obtained around 1745 either today or Monday.
We shall see if the markets react accordingly (i.e. negatively) as to my Mercury Max scenario and respects the lunar red period after the lunar eclipse of Oct 18 heading into the solar eclipse of Nov 3.
@Awakening:After you see the close 1644, what look to next week?
Delete*1744
DeleteHi Inlet,
ReplyDeleteI am newbie in terms of investing. quick question about how to set the parameter for ENV indicator, what is the 3rd one for e.g. ENV (23,2.15,-13)
http://blogs.stockcharts.com/mailbag/2012/08/how-can-a-shift-a-moving-average-forward-or-backward-.html?st=envelopes+parameter+3
DeleteShift the envelope to center over #s being averaged....
Broke above my upside projection and a new SPX high
ReplyDeleteBest wishes for continued
ReplyDelete