Tuesday, May 24, 2011

5/24 Daily Commentary

SP futures tested their 30-minute M/A several times and in the afternoon finally fell back.  DJ daily M/A is the only M/A holding back the decline.  A support zone extends down to 12,250 basis June.

My goal is to be there when a substantial decline occurs.  If the 8-day lead has been eliminated then the following chart shows rally and the market will post a temporary bottom and rally, at least for several days:

Pima posted a question as to why the quake would induce a lead into I1 that has not occurred in the past several years.  Since I1 reflects instinctual behavior my theory is that the mind operates at different frequencies at different times.  These are expressed as actions according to natural cycles.  The reason that I present cavaets about the cycle charts is that they reflect fixed cycles looking backward for positive correlation.  Fixed cycles do not express the human dynamic, which is why various cycles operate, then cease to operate, then operate once again.  I1 projects the frequency of the moment for the mass as it reacts to it's environment.  The Japan quake threw off the operating frequency to a different one temporarily and the mass responded to environmental inputs using a different cycle.  That's how I see it.  Moving averages reflects these cycles as well, but we don't know in advance if a particular moving average will operate in the current environment.  All we have is the probability that it will.  When a moving average begins to operate in real time it tends to operate for the remainder of the trend, however long that is.

I'm holding only the short mutual funds.  Silver is rallying hard and projected to nearly $39 (38.65 green line).


  1. Thanks for that lead/lag explanation!

  2. 12250 DJ futures support has been breached.
    Maybe this article is one reason:

    Looking forward to your pre-open comments!

  3. Thank you, Steve, for your explanation. Makes sense. Amazing work you're doing here. Thanks for sharing it.

  4. Pima, thanks for the boost.