Friday, November 5, 2010

11/5 Weekly Commentary

I went short SP futures near the close at 1221.50 on the I1 peak and a head-and-shoulders in progress.  The rally right at the close was too strong to imply a H&S.  Looking again at the wave count it can count as today's consolidation being a wave 4.
The real fly in my soup is the Nasdaq Composite.  The Nasdaq has a long rectangle forming which fits right in with a wave 4 as well.  Carl had the target right at 1234.93, the 61.8% retracement (or something close to it).
I covered the SP short at 1221.50 for no loss.  I'll short again on Monday since I1 peaked today there is rarely more than a 1 day miss when I1 falls on a Friday.
Crude made a late spurt to a new yearly high and I was stopped out at 87.25 with a short price of 87.10 so no harm.  Although the wave counts a nice complete 5 up to complete an abc up a new yearly high requires me to be out.  If crude reverses Sunday evening I'll go short again.  Sometimes bear traps occur around new yearly highs.  I like the crude short because of the nice abc count and it's sentiment gauge:


The dollar index is close to triggering a buy stop predicated on the hourly key M/A.  However, the position of the stock market (opening a final 5th wave spurt) causes me to believe that the dollar trade will wait until after the stock market peaks.  If I am wrong about the stock market count then a Nasdaq futures break below 2176 will get me short early.
I'll post technical composites tonight if they are relevant.
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6 comments:

  1. Grumpy Bear CharlesNovember 5, 2010 at 5:32 PM

    Steve et al.,
    I've got weekly sell signals on all the big indexes I track with daily ones likely to follow by Tuesday. Typical weekly signal is 1-3 weeks so this fits with I1 being weak until mid Nov. Not to toot my own horn but my double top call looks decent right now, not that I made any $ on it due to my own idiotic trading. This week did give me an intermediate buy signal on my trend follower which leads me to think we should buy this dip as it doesn't signal often. We have an interesting potential setup predicting bond yields to rise after December. Typically that should correlate with higher stocks but let's see if it unfolds. And meaning no offense as I include myself but we sound like a bunch of hopeful loser bears waiting for next week week after week. Have a good weekend everyone!
    Charles

    ReplyDelete
  2. AnonymousNovember 6, 2010 at 5:50 AM

    ES
    An AB=CD pattern may indicate a top at these levels.
    http://99ercharts.blogspot.com/2010/11/es_06.html
    Have a nice weekend.

    ReplyDelete
  3. AnonymousNovember 6, 2010 at 6:39 AM

    Achtung.
    http://www.reuters.com/article/idUSTRE6A50VN20101106?rpc=77

    ReplyDelete
  4. CarlNovember 6, 2010 at 6:44 AM

    Hi Steve, just realized that when I mentioned the 61.8% retracement of the index since 207 top I meant ES500 continuous contract; for SPX index 61.8% is 1228.74.
    The high on Friday was 1227.08.
    Enjoy the weekend and again thank you so much for your fantastic blog. Carl.

    ReplyDelete
  5. DanNovember 6, 2010 at 11:01 AM

    Steve,

    Do you have any thoughts on what Elliott Wave count we are in? If critical support is broken before 11/15, will you hold any short positions?

    Thanks.

    ReplyDelete
  6. AnonymousNovember 7, 2010 at 7:45 AM

    Looking at the major crosses, the USD appears to be bullish; let's see what happens this week at the G20 as the BRICs--and Germany--voice their concerns to Ben and Tim.

    GBPUSD
    http://99ercharts.blogspot.com/2010/11/gbpusd.html
    EURUSD
    http://99ercharts.blogspot.com/2010/11/eurusd_06.html
    USDCHF
    http://99ercharts.blogspot.com/2010/11/usdchf.html
    USDJPY
    http://99ercharts.blogspot.com/2010/11/usdjpy_06.html

    Good luck!

    ReplyDelete

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