Three influences over all markets:
First I1 is due for a weak uptick through 11/5. I believe the stock market will not hold up after the 11/3 FOMC announcement. I will be shorting earlier than the I1 mini-peak.
Second, the dollar index looks like Minute 1 upward is complete. It also confirmed the buy signal with a daily close well above the 18-day M/A.
Third, DJI came down near it's critical support and is rallying off of this low. There could be an ending diagonal finishing with another nominal new high in SPX.
The dollar index came down very quickly to it's wave 2 bottom. The stock market is starting to sell off since the dollar lows. Taking out 11,000 seems doable here given any dollar strength.
The 90-minute close on the dollar will tell the tale of who is winning the battle, investors or the Fed.
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Steve
ReplyDeleteYou have talked about I1 a lot lately and tried to defend its integrity and I just want to say in it's defense that I look at it as another tool in a technicians tool box to help determine trading strategy and any one living by it like it is the gospel of trading would be very foolish. I have not seen a trading tool that is 100% perfect yet and for someone to say it is a failure in my mind would be saying equally that all the trading tools are failures. I think most of us appreciate I1 for what it is not what is not.
Jack C
Hi Jack,
ReplyDeleteThe markets are no place for the naive. I believe that world capital flows (investors) will defeat the Fed. You can see it happening now. Ben will tiptoe into the next QE.
Steve
ReplyDeleteYou can see them trying to tern the ship in front of this 3rd wave and there efforts are failing. This is much bigger then the Feds and there efforts now will have very limited results (60 years of inflation from recession control now leads to deflation and more of the same will not work any more, 13.5 trillion and counting not to mention the unfunded entitlements). Its like looking at a 500 pound gorilla coming at you, do I run or do I throw stones because those are my only choices, the end result is the same, get the picture?
Jack C
Fight or flight. Americans have been running into debt since they figured out that their government was an inflation machine. Why fight it? Just take advantage of it, that's what the smart guys have been saying since the 60's. Real estate will never go down. Now it's gold will never go down. When Ben runs out of arrows and GOP takes the house we could see the first recession in 40 years without government intervention. It will all be on the Fed when the economy turns sour. They have to be thinking of saving some arrows in their quiver. Or does nobody think that far ahead anymore?
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