comments and outlook for 05-31-2011

I mentioned in my weekly outlook we may be seeing the reappearance of the 34TD cycle.  It will take some more time to confirm that (or not confirm it).  But we can project based on it not re-emerging and we can project on it re-emerging.

First let's assume that the 34TD cycle is not coming back into play.  In that case we have the 22TD cycle up, the 11.2TD and 5.6TD cycles down. The 2.8TD cycle is up but should top by day's end.  So that is 2 up and 2 down...  My opinion is that could lead to some downside early and a bounce back later for a reasonably flat day.

Here is a visual for that scenario:

The second scenario is that the 34TD cycle is back.  This means some of the shorter cycles may have truncated and shifted into this new reality.  This means the 34TD cycle is up, the 11.2TD cycle is up, the 5.6TD cycle is down and the 2.8TD cycle is up and should top during the day.  In this case I would expect the market to move up early and possibly pull back once the 2.8TD cycle tops.

Here is a visual:

  
So tomorrow's action may provide us a data point that points us a little to the left or a little to the right.  I am inclined to think the 34TD cycle is coming back.  At this time that is more a hunch than a conviction. So I am going with up early and then down (still not a lot of movement).

GL traders.  Your money, you decide.

TKLC as of 05-28-2011

Received a request to chart TKLC.  Looks like it is topping and should be exited for the time being.  Here is the requested chart:

GL traders.  Do your analysis - Joe has.

comments and outlook for week of 05-31-2011

Strange week.  Started out like we might have a serious sell off and spent the next 4 days recouping most of the first day's loss.   It doesn't feel like it but we have had 4 down  weeks on the S & P 500 in May.  This week it lost about 2 points for the week.  On average it has lost about .5% a week (7-8 pts) in May.Feels like the market has gone nowhere in May (and with all the moves down and up - it hasn't moved much) - a little over 2% for the month.

My task is to try and interpret the data and inform you as best as I can what to expect in the coming week(s).  An interesting development this week.  It appears the 22TD cycle may have faded out of the picture and the 34TD cycle is back.  It will take a couple of weeks to be surer of this, but for now that is how the data (and charts) appear.  Not unusual for a cycle to fade after 3-4 complete cycles, but the 22TD cycle may be fading out after just 2 complete cycles.  We will see.

Now I often have an opinion on how the market will behave based on what I believe are the prevalent cycles.  If the data changes I try and change that opinion. If the 34TD cycle is indeed back it will not top for a couple of weeks (mid June).  So that 2% we lost in May could well be recouped by this cycle in the first half of June (1360 S & P?).  This changes my view of June as I had previously expected it to be mostly down.

Longer term though it still appears we have a nesting of cycle lows in early to mid July.  So maybe we get one more move up toward the peaks and then down hard into July.  That seems to be the indications from the current data and cycle positioning.  

Here is a visual:

GL traders.  Do your own analysis.

comments and outlook for 05-27-2011

The day was a bit greener than I expected.  Still, it traded pretty much within the expected range.  The downside pressure of any longer cycle continues to build and I do expect soon we will get a big down day that will set new lower lows.

Today - looking at the shorter cycles - the 2.8TD cycle topped yesterday and is down, the 11.2TD cycle is down.  The 22TD cycle is still up (about 3-4 days to a top).  The 11.2TD cycle is down (about 3 days to a bottom)..  The 5.6TD cycle is up but should top by end of day.  So we have a mixed situation.  I expect downside pressure during the day - maybe an attempt to rally by the end of the day...  For the day I expect the S & P to be down.

Here is a visual:

GL traders.  Do your own analysis and be careful.

Comments and outlook for 05-26-2011

Today was another relatively calm day.  The downside pressure from the longer cycle (1 yr) down leg continues to accumulate.  At some point that energy will be released as the spring snaps back.  The longer it builds the more severe that snap back is apt to be.

For tomorrow the short cycles are mixed.  The 2.8TD will top by midday.  The 22TD cycle and  5.6TD cycles are up.  The 11.2TD cycle is down.  some upside expected the first half of the day and then possibly a fade after the 2.8TD cycle tops.  So I expect moderate action from the shorter cycles with a flat to down close.  But, I have no idea if the 1 yr cycle down leg will kick in tomorrow or not - if it does then we could break some downside support levels.

Here  is a visual of the shorter cycles:

Gl traders.  Do your own analysis, stops are recommended.

LDK 05-17-2011 - update 05-26

Someone suggested I look at LDK.  It appears LDK is at a 22TD bottom and normally that would suggest a potential buy.  One problem is there is a longer cycle (6 months) that is also near a bottom (about 1 week).   Now it may get a bounce off the 22TD bottom, but I suspect that the 6 month cycle needs to bottom first to get a serious upside run.

Here is the chart:

GL traders.  Do your own analysis.

05-26

Updated chart.  It appears LDK has/is bottoming.  The first upside target (about 3 weeks) is around $8.

GL - do your own analysis

Comments and outlook for 05-25-2011

Today was a relatively calm day, up early and a fade during the day.  I expect the longer cycles will continue to build  up downside pressure tomorrow, but you have the 3 shorter cycles up and one topping.  Do we have another day with limited movement (as the downside pressure builds from the longer cycle)?   This longer cycle down pressure could kick in at any time.  That could be tomorrow (futures showing a lot of red) or the day after, but I believe it will happen soon.  Hard to get a fix on exactly when this will happen.   If you are long use trailing stops.
Here is a visual:

GL traders.  Do your own analysis.

comments and outlook 05-24-2011

Today a lot of built downside pressure got released.  After such an event at least a small reversal is normal.  And we got a bit of reversal late in the session.  We may get a bit more early tomorrow.  After all the 22TD  and 11.2TD cycles are up.  The 5.6TD and 2.8TD cycles are down. So we would not expect much of a move either way from these cycles.  So I expect later in the day the longer 1 year down leg may again assert itself (but not to the same extent as today). 

So I think we see some up early and late down later in the day.  1310 seems to me will provide support (see lower trend line on chart, and it is a FIB number):

I believe I incorrectly stated the position of the 20 week (Wall) cycle the last time I spoke of it.  So I have provided a chart showing the longer cycles that are influential at this point:

Gl traders.  Do your own analysis. 

comments and outlook for 05-23-2011

The outlook for Friday - not a good call.  It seems that expectations based on the shorter cycles are not being realized.  So this leaves me conflicted....  The short cycles should be up, but the market seems to want to go down.  To me this indicates that longer cycles (the 1 yr down leg?) are taking control.

So I am going to make a judgment call - I think we somewhat ignore what the shorter cycle are telling us and go with the evidence that they are being dominated by the longer term market cycle momentum.  I showed you on one chart in my weekly outlook where MFI was projecting a bottom at the point where the 22TD cycle should be topping.  I also think with the 1329 FIB (just below Friday's close) there is a better than even chance we break below that and if we do the market could easily fall to 1310...

The short cycles are up, but in my judgement the momentum is to the downside.  So that should give us a down market. Probable some time during the day the bulls push  up, but the bears win the day. Keep in mind the 1 yr should be hard down at this point and the 20wk has topped or is ready to top.  In short more volatility with a down bias.

Here is a visual of the shorter cycles:

GL traders.  Do your own analysis.  I can and have been wrong before - and it was difficult to make a call in predicting the action for Monday.

 

Spiral dates for June

http://spiraldates.com/2011/charts/scores_0611.png

this is for you c_k....