Friday, September 30, 2011

S&P 500 ~ Intraday Update 1 ~ 30 September 2011

After we got a rally from the 1120 support area to the 1190ish resistance level earlier this week the SPX has declined back to the 1140ish support. So, the market continues to bounce between the support and resistance levels:

Once this range breaks (~1120-1220) we should see a big move (up or down). My guess is down but we'll see... ; )

Wednesday, September 28, 2011

S&P 500 ~ Update ~ 28 September 2011

At the beginning of this year I expected a huge rally up to 1600ish by the end of this year/early 2012. Until July it looked like we were on track for it but early August the SPX broke below 1260 which was a sign that the rally was most likely over:

During the last two decades the weekly MA 76 was very reliable (as you can see in the chart above). Early August the SPX fell below it and since then each rally was stopped at the MA 76. Thus, as long as the market stays underneath it I'm bearish long-term.

The long-term Elliott wave count, I've been using for almost a year, isn't valid anymore. It's always a bit tricky to post long-term counts since there are endless options to count the markets but nevertheless I'll post the two scenarios which I think are the most probable ones:

Scenario 1: We're not in a new bear market to new lows below 666 but only in a bigger correction of this bull market. Preferred target for this correction is the 930-1010 area (50-62% retracement, 2010 low). After the SPX will have completed wave [X] we should see another big rally to new all-time highs.

Scenario 2: At 1370 the SPX completed a cycle wave b in an ongoing abc correction. During the next months and years the market will decline and eventually hit a new low below 666. A potential target for wave c is at 480 where wave a equals wave c. Coincidentally 480 is the level where the SPX started to take off in 1995. Once cycle wave c is completed all the mess in the world (debt problem etc.) should be solved so that we can start a new big bull market.

So, short- and medium-term these two scenarios are very similar. We shouldn't see a break above 1260ish, if we do though then both scenarios, especially scenario 2, are unlikely. Long-term they are very different though. Which scenario is more likely depends on what the SPX does once we enter the 930-1010ish area.

The bounce from 1120ish continued yesterday. We rallied all the way up to the resistance around 1190ish:

Support and resistance levels haven't changed. Still at 1120, 1140, 1190, 1220, 1230.

Silver ~ Update ~ 28 September 2011

From the top at 50 $ an ounce silver has lost almost 50 %. So far it looks like a perfect ABC thus wave [4] may have been completed at 26$ and wave [5] is underway now. It's too early to tell though, I'd like to see a break of the 33ish area first. If we break and hold this level we should be in wave [5] back up to the all-time highs:

As mentioned earlier this week we should see a bounce from 26 $ probably up to the 33 $ resistance level. And that actually happened - after a 13 $ drop within 48 hours we got a 28 % rally within 30 hours!

Resistance levels still are around the 33 $ level and then at 39 $. Support levels are at 26 and around 20-21 $.

On Monday we got one hell of a reversal:

I think that's the biggest doji I've ever seen in my life. Dojis usually form at market turning points thus we may have seen a short-term or even medium-term low on Monday.

To sum up, despite the huge sell-off silver looks still bullish long-term (we could drop a bit further to 20ish though). Short- and medium-term silver is bullish again once we break the resistance at 33ish (and hold it afterwards).

Tuesday, September 27, 2011

Gold ~ Update ~ 27 September 2011

I haven't posted long-term gold charts for almost ten months. Back on January 1st I wrote that we could see a small correction in gold but that we should be higher at the end of 2011 and that I didn't see a gold bubble yet.

So far this has worked out pretty well, we got the rally and also a correction but we're higher than at the beginning of this year.

After the most recent drop in gold almost everywhere one could read that the gold bubble burst (for like the 3510th time I guess). Just have a look at the long-term chart above...

That's one of the most bullish charts I've ever seen and there's just no reason to short it neither technically (the uptrend line is still holding) nor fundamentally (the FED and the ECB still want to solve the debt problem by creating more debt...).

So, long-term I still expect much higher prices (unless of course the FED/ECB etc. decide to solve the debt crisis by saving money and not by spending more... (not gonna happen though imo)). I don't have any specific price target though... just go with the trend and let's see how high it goes ; )

After gold broke out of the triangle at around 1840$ it declined about 300$ and bottomed right at the orange uptrendline and as long as it holds the medium-term trend for gold is up.

Short-term we might have seen a bottom on Monday (maybe even medium-term). We got a huge hammer which is usually a sign of a trend change:

To sum up, as long as the FED wants to solve the debt problem by creating more debt gold should go much higher (long-term). Medium-term the uptrend is still intact and short-term we may have seen a bottom on Monday.

I prepared two other posts (spx & silver). I'll post them a bit later though.

Monday, September 26, 2011

S&P 500 ~ EOD Update ~ 26 September 2011

The bounce from the support at 1120ish continued today and we almost closed the open gap at 1167.

Resistances are at 1167 and 1190ish, supports at 1140ish and 1120ish.

I'm going to post an updated EW count tomorrow and some medium and long-term charts on the SPX, gold and silver. So you might wanna check these out tomorrow. ; )

Have a nice evening!

Silver ~ Update ~ 26 September 2011

I hope you remembered that I wrote that the support at 38-39 $ was very important...

The support broke less than two trading days ago and today silver hit 26 $, that's right, TWENTY-SIX - i. e. silver has lost one third of its value within less than 48 hours!

During the crash in 2008 silver lost about 60 %. If this happened again today the target would be around 20 $:

Next support level is around 26 $. If it breaks we should see another sell-off into the low 20's. Resistance is at 33ish.

Friday, September 23, 2011

S&P 500 ~ Intraday Update 1 ~ 23 September 2011

We're getting a nice rally from the support at 1120ish:

We're now back at the 1136-40 resistance level. If we can break it the next target is the open gap at 1167.

Thursday, September 22, 2011

Gold ~ Update ~ 22 September 2011

Along with everything else gold declined today and is now near the late August low again.

Maybe you remember the triangle I showed ten days ago. It broke to the downside and since then gold has lost  around 100 $:

The 1670/1705 area (gap/Aug low) is the next strong support area. If we break it we should head to the 1550ish area:

S&P 500 ~ Intraday Update 1 ~ 22 September 2011

Wow! We're already at the support level at 1120!

After breaking the critical support area at 1190 yesterday the SPX lost 70! handles within less than 24 hours:

If we break 1120 we should retest the lows next. Resistance areas are at 1140ish, 1167 (gap) and 1190ish.

S&P 500 ~ Pre-Market Warm-Up ~ 22 September 2011

Once 1190 was broken the SPX fell apart:

Next support is now at 1140ish and then 1120ish. Resistances are at 1190ish, 1220 and 1230.

Wednesday, September 21, 2011

Nasdaq ~ Elliott Wave Count ~ 21 September 2011

The Nasdaq rallied to the strong resistance in the low 26xx area earlier this month. Since then it has lost about 100 handles and it looks like the next downwave is underway:

Tuesday, September 20, 2011

S&P 500 ~ Elliott Wave Count ~ 20 September 2011

The bounce from the 1190ish support area continued during the first few trading hours today. By noon the SPX hit 1220 and then pulled back and closed slightly lower at 1202:

As you can see I still like the wave B/2 count. If we break below the 1190ish area I think it's very likely that wave C/3 down is underway.

At 2:15 pm tomorrow Bernanke speaks once again so (as usual) markets should go crazy ; )

Monday, September 19, 2011

S&P 500 ~ EOD Update ~ 19 September 2011

On Friday the SPX finally broke the 1204-08 resistance area but already at the open today we were back below it. The market declined down to the 1190ish support level, bounced there and closed at 1204:

Nothing has changed actually. Support levels remain at 1190ish, 1140ish and 1120ish and resistance areas at 1204-08, 1230ish and 1260ish.

Friday, September 16, 2011

S&P 500 ~ Pre-Market Warm-Up ~ 16 September 2011

As already mentioned yesterday we got a nice pullback after the SPX hit the resistance level at 1204-08. By the end of the day though the market was back above 1200 and closed at the very upper end of the resistance level at 1209.

If we get a convincing break of the 1204-08 resistance level the next targets are 1230ish and 1260ish. Support levels are at 1190ish, 1140ish and 1120ish.

I'm not at home today so unfortunately this will be the only post for today.

Have a great day!

Thursday, September 15, 2011

S&P 500 ~ Intraday Update 1 ~ 15 September 2011

After the SPX hit the 1204-08 resistance early in the morning it declined about 14 handles - not bad : )

Wednesday, September 14, 2011

S&P 500 ~ Elliott Wave Count ~ 14 September 2011

The bounce from the support area at 1140 continued today. By early afternoon the SPX hit my preferred target for a potential second wave at 1186. The market didn't show any signs of weakness there though and just rallied further up to the next resistance area around 1204-08.

As you can see in the chart the support and resistance areas continue to work very well:

Support levels remain at 1140ish and 1120ish. Resistance areas are at 1204-08, 1230ish and 1260ish.

Even though the (i) (ii) i ii count is technically still possible I changed my SPX Elliott wave count so that it matches my Nasdaq count. Wave A or 1 ended at 1120 and wave B or 2 is now underway.

There is a noteworthy bearish alternative count though: today's rally could be a wave c of (ii), i. e. wave (i) ended at 1140 on Aug 6th and wave (ii) at today's high (or tomorrow slightly higher).

I suggest to use the support and resistance levels to enter a trade though. If you look a chart again you can see how well these levels worked during the past few weeks - in fact much better than Elliott waves.

S&P 500 ~ Intraday Update 2 ~ 14 September 2011

Gap close!

Let's see if we get some sort of a reversal at this level or just rallly further.

S&P 500 ~ Intraday Update 1 ~ 14 September 2011

The SPX opened higher today at around 1180. Since then the market has been selling off all the way down to yesterday's noon low at 1161ish. If this level breaks wave iii is most likely underway:

If 1161ish breaks next support levels are at around 1137-40 and 1120ish. Resistance levels are at 1186 (gap), 1204-08, 1230ish and 1260ish.

The ES channel is holding so far. Unless it breaks we might still see a rally to SPX 1186 (= ES ~1179-80).

Tuesday, September 13, 2011

S&P 500 ~ Intraday Update 1 ~ 13 September 2011

The SPX is now in the target box for wave ii:

As said yesterday I wouldn't be surprised to see a rally to 1186 to close the gap (similar to what wave (ii) did).

Above 1186 next resistances are 1204-08, 1230ish and 1260ish. Support areas remain at 1140ish and 1120ish.

EUR/USD ~ Update ~ 13 September 2011

(I'm away this morning so unfortunately there won't be any intraday updates until late in the day (~2 pm))

I haven't posted an update on the EUR/USD for quite a long time (mainly because nothing happened...)

Earlier this month we finally got a convincing break break of 1.40ish and quickly declined to my next support level at 1.34-35:

Strong resistances are now at 1.40ish and 1.45ish. Supports are at 1.34-35 and 1.29-30.

Monday, September 12, 2011

S&P 500 ~ Elliott Wave Count ~ 12 September 2011

That's why I wanted to see an hourly close not only below the trendline but also below 1140ish... : )

It looks like wave i of (iii) ended at 1136 today. Wave ii should be underway now. A common retrace for a second wave is 50-62 % of the first wave (i. e. 117x). I wouldn't be surprised to see a rally back to 1186 to close the gap though (similar to what wave (ii) did). If we break above 1186ish the count below is most likely wrong.

As you can see in the chart support areas are still at 1140ish and 1120ish. Resistances are at 1186 (gap) and 1204-08.

S&P 500 ~ Intraday Update 1 ~ 12 September 2011

The SPX gapped down into last week's low around 1140ish. From there the market rallied and quickly closed the open gap:

Even though the SPX was below the orange support line for a few minutes I don't count it as broken. I'd like to see an hourly close below it (preferably even below 1140ish).

Until it breaks I see this as a succesful test of the trendline thus we might bounce a bit further here. Possible targets are 1166, 1175ish or even the gap at 1186.

Gold ~ Update ~ 12 September 2011

Gold made a new all-time high last week at 1920 $ after selling off about 200 $ late August. So, once again those who said that the gold bubble burst or that wave 5 of 5 of 5 of an extended fifth wave was completed have been proven wrong...

Important support areas are at 1670-1700 and then the orange trendline around 1500. As long as these levels hold the uptrend is intact. Resistance level is at 1920ish (double top). If we break it we might see 2000 $ very soon.

A reader pointed out that gold is in a triangle:

If you trade gold (I don't, I only buy it... : )) this looks like a very nice setup. Wait for a breakout though.

Friday, September 9, 2011

S&P 500 ~ Intraday Update 1 ~ 9 September 2011

The SPX didn't rally above 1210ish thus the bearish count still looks very good:

We're back down at the orange trendline and if we break it a test of the lows is very likely and most likely also new lows.

Thursday, September 8, 2011

S&P 500 ~ Pre-Market Warm-Up ~ 8 September 2011

The SPX is still trading in the bear flag:

Yesterday the SPX rallied to the 62 % retracement of the (potential) wave (i) of [v] down which is a common retracement level for a second wave. So if the market turns again between 1200 and 1210 we should see a wave (iii) down to new lows (confirmation if we break below 1140).

Should the resistance at 1210 break though the other count I posted about one week ago ( / (wave A/1 bottomed at 1120 and we're now in wave B/2 up to 1260ish)) might be underway. Next resistance levels are 1230 and 1260ish.

Tuesday, September 6, 2011

EUR/CHF ~ Update ~ 6 September 2011


As of today the SNB will no longer tolerate a EUR/CHF below 1.20 francs. In other words the SNB joins the money printing policy which leaves gold as the last save haven...

After hitting the 1.18ish resistance the EUR/CHF sold off again and closed the gap around 1.11 early September. From this level we got the huge SNB spike today to way above 1.18ish. Next resistance is around 1.24, suppport at 1.18-19.

If you have a look at the action in 2009 (orange circle) you can see that there was actually no action - the EUR/CHF traded around 1.52 for the entire year. Back then the SNB didn't tolerate a EUR/CHF below 1.5.  Today the minimum rate is 1.20 so if the SNB really wants to defend the 1.20 level we might see the same again: sideways between 1.20-24 for the next few months.

But mabe the situation will change again in two weeks when the FED strikes back... ; )

Thursday, September 1, 2011

Email problems & Gold ~ Update ~ 1 September 2011

Today I noticed that for some mysterious reason Google didn't forward emails which were sent to admin(at)gmail(dot)com to my main email address.

So if you didn't get an answer it wasn't because I ignored you but because I didn't get the emails. ; )

I created a new filter in gmail and tested it and it works now. So from now on you should get a reply much faster ; ) And to all of you who sent me an email during August: Sorry again for the late reply!


Gold dropped about 200 $ last week and once again we could read that the gold bubble burst or that gold finally completed wave 5 of 5 of 5 of an extended fifth wave...

But seriously, I don't know how you can make money if you've shorted gold each time it declined more than 50 $ in the past few years...

Don't get me wrong, sometime gold will go down but for now the uptrend is still intact and remains intact as long as the rising trendline around 1500$ holds.