We're only down to around the low 1370s, but its a pretty damn good way to end the week. The mini H/S formation is confirmed. The great H/S formation on the daily cycle will also be confirmed if we break around 1340 - or 1365/60..depending on how generous you wish to be to the bulls.

The VIX is finally showing some significant upside, but it still is not quite enough to get hyper-bearish yet.


Sp' daily, bearish' count2

VIX, 60min

As is often the case, the question now is....'who wants to risk holding long across the long weekend?'. I'd expect weakness across the afternoon, but especially in the closing hour.

*as I post this...we did briefly break 1370.... 1369..is a very good sell-signal. 30pts open-air to go :)

Things are indeed looking good for the bears...more across the afternoon.

The bears have to admit today is going better than they could have hoped for. The early pre-market chop nonsense...has turned to some good 1% falls across all indexes. The VIX is finally showing some sign of trouble ahead.. +6%...although still only a minor move.

Best of all right now, the daily cycles on both the SP'500 and the Rus'2000 index are now negative cycle (see MACD, blue bar histogram indicator). On balance, we should cycle lower for at least 3-5 trading days, so...perhaps all of next week.

So, lets focus on those daily cycles, ignore the intra-day noise!

SP, daily

IWM, daily

VIX, daily, bearish market scenario

Bears do need to see VIX see a +10/15% up day 'soon'. 5% just won't cut it, and would suggest underlying strength still in the market.

However, as noted, those daily cycles are looking VERY good for the bears. Downside targets are clear, stop levels are clear...there are no excuses.

More later.

The choppy pre-market action has reverted back to yesterdays consistent weakness. Watching Rick Santelli on clown channel, he remains the only voice of reason amongst the entire mainstream financial TV networks. It is always a wonder he is still 'permitted' on TV for speaking the truth about what are truly dire jobs data.

The daily cycle now becomes paramount to keep in mind...so lets start with....


Sp' daily..bearish H/S scenario

A clear break under the 10 and 50 day MAs. As I noted yesterday, these were always important to break through early in the day, so that's a very good sign for the bears.


Sp'60min

Regardless of the intra-day noise, keep that daily chart in mind. If...it is correct, we do indeed have a considerable way to fall next week.

Right now, bears would certainly like to see the market close down at least 0.5...preferably 1%. Anything under sp'1380 would be a bonus.

*It remains an added bonus to see AAPL -$9 @ 572 (breaking the important $580 level), for me, it confirms the underlying 'hysteria' phase is coming to an end.

Good wishes!

Good morning. April Jobs data - weak again, 115k vs expected 165k. Market slips 0.5% on the news, I'd expect weakness throughout the day.


SP'60min

update 9.08am EST

AAPL breaks 580, I would argue this is a key sign for the tech sector, and the wider market.
Market briefly bounced after the earlier snap lower...but we're now -0.5% again.

Very dire underlying jobs data (see zerohedge!)...as I said all along...

There is no recovery...there will be NO recovery.

Good wishes for Friday trading!

As I've highlighted a few times recently (see: Fair Value Stocks) the Coal miners have again been getting destroyed, but its not just them, general mining and other commodity related stocks have seen considerable losses. The CRX commodity related stock index is useful to at least occasionally review.


CRX, weekly, 5yr historic

*post inspired by Albertarocks
see: http://albertarocks-ta-discussions.blogspot.com/
--

The CRX caught my attention as early as Spring 2011 - which was interestingly when we put in what may become a long standing price peak.


Another giant H/S formation?

Since the 2008 collapse wave, and the subsequent 'rally of delusion' the CRX is one of the cleanest looking H/S formations for anything out there. The RS peak of March'2012  never came close to breaching the February 2011 peak. It is a formation that looks good, and it is now seemingly on a trend that will take out a number of key warning levels.

Primary CRX target for the bears will be 680. That is 150pts lower, roughly 18%. Such a level would indeed equate to somewhere around Sp'1150/00. The last time CRX was at that level, SP' was indeed 1000. I'm not expecting Sp'1000 this summer, although it is something to keep in mind, but surely we'd need a black swan or two to reach those low levels.

As for those other two levels of 550 and 450, I just can't see that happening until 2013, if at all. The Bernanke - and other central bankers, will want to do everything in their powers to prevent a second deflationary collapse wave. We all know Benny will already be standing by to hit the QE3 button, but as is ALWAYS the case, the Federal Reserve is reactionary to events, they never pre-empt.

So, Bears 'should' have a free ride down to at least sp'1150/00 across the next few months.
---

I think that's it for tonight....

We will probably have some big market moves tomorrow...one direction or...the other.

Goodnight from London

A moderately lower day across most indexes, with the VIX putting in a moderately higher close. In the scheme of things, its nothing 'significant' yet, but the potential is there for some exciting down moves both tomorrow and into next week. Perhaps the ultimate question is what the algo-bots will do tomorrow morning if the jobs data comes in under 100k. Whilst many of the European indexes (not least Spain) have already been in what continues to be a major collapse wave, the US market has not had a decent down day in over 7 months. Maybe tomorrow.


IWM, daily

SP, daily

Transport, daily, rainbow (Elder impulse)

VIX, daily, rainbow

Summary

The daily charts are clear, there is great potential for a significant down wave in the coming days. From a cycle perspective, everything is just starting to rollover. The big money will now have short stops around 1395/1400 tight..or 1415/22 lose.

More later in the evening...(probably).

A pretty good day for the bears, and it sets up what will likely be a brisk Friday trading session. VIX still noticeably lagging though.


Sp'60min

IWM'60min

More later, dealing with those daily charts.

The weakness continues, a close under the 1394 level would be preferable. A lot of individual signs to look for..not least the AAPL, which looks like it'll break the big $580 level - opening up $500 (best bear case) in the near term.


Sp'60min

Bears must see a close under the 10MA - currently sp'1396

The jobs data -and the level of intensity with which the market reacts to it, will be.so very important tomorrow.

More after the close.

Finally, we've a clean break below 1394. Things are starting to get real interesting, even the VIX is starting to pick up almost 6% (with a buy signal on the VIX rainbow chart).


Sp'60min

Nothing else to add right now, aside from the fact that it is certainly pleasing to see a formation/theory develop, and be confirmed :)

The daily cycles are now looking VERY promising for major downside in the coming days.

The recent 'everything is gonna be great for the rest of 2012' hysteria on the various clown channels is noticeably fading these past few days. Similarly, Mr Market sure is looking weak from the daily cycle perspective. I'm not expecting much this afternoon, other than continued moderate weakness. However, Friday could be a really exciting and dynamic trading day.

Lets assume we close somewhere between 1390/1400 - which is appears highly probable. A good 1.5% lower tomorrow will get us to the lower channel of what is still a giant bear flag on the 60min cycle. A bounce there would be normal...and then a further wave lower either late Friday or sometime Monday.

One important factor to keep in mind - the bears MUST see the VIX start to show some +10% daily moves soon, if some of the bearish index targets - sp'1340/1300 are to have any reasonable chance of being hit.


Sp'60min

More later!

Its looking pretty good for the bears. The bulls failed to break a new high on most of the indexes (the dow was the exception) this past week  The question remains, how will the market react to the jobs data tomorrow? We've seen some very mixed data these past few weeks, but the data for April has so far been a little concerning. A sub 100k net job gain would probably send this market down at least 1.5% tomorrow - aka sp'1375 - a level at which I'd expect an intra-day bounce.


Sp'60min

IWM'60min

VIX'60min

*no sign yet of the VIX showing any significant upside..perhaps near the close we'll see something?
--

More across the afternoon..have a good lunch.

Whilst the main market is again back to churn mode for a few hours, lets take a quick look at the bigger picture, focusing on the Rus'2000 small cap index (via IWM etf).


IWM, daily, bearish H/S scenario

IWM, weekly

The daily cycle looks pretty good for a rollover. The weekly cycle looks like we've seen yet another failure to break/close over 83.00. Certainly, the 83.00 level is a great place for short-stops, for those with 'serious money'.

--
Sp'60min update

Is the RS complete? I don't know, it won't be clear until after the fact of course, much like almost all technical analysis. In terms of the SP', a break <1394 would be a real sign that theory was maybe correct, but even then, we need to put in a number of consecutive intra-day lower highs - especially tomorrow.

Whether bullish or bearish right now, just be glad you're (hopefully!) not one of  those Green Mountain stock holders today., currently around 40% lower. GMCR is yet another one of those infamous momo (momentum) stocks that always eventually get destroyed - just like NFLX, and almost all of those overpriced 'social media' pieces of junk.

*ISM non-manu: 53.5 vs  56.0 expected.   A weak number, and it won't please the market!


SP'60min

Not much to add right now, if it is a mini H/S, then the RS 'should' complete today, and then we fall away into the close - with a snap lower Friday morning. Its just an idea, and as ever..the 'smart/big/serious' money will be using good stops regardless.


Special bonus chart on....GMCR, daily

You can see the lunatics chased this nonsense up across the last 3 years, but such things rarely end well, and today is another important reminded that eventually...'price discovery' does happen, even in what remains an overpriced and largely deluded stock market.

More later...

Good morning. Futures are catching a bid as weekly jobs data came in better than expected at 365k vs 378k expected. Productivy numbers came in largely in line at -0.4% (Q1/Q4 change). Note that we have ISM non-manufacturing number at 10am, that will likely give the market an excuse to solidify gains..or sell off any opening rally.


Sp'60min

From a cycle MACD (blue bar histogram) perspective, we are certainly inclined to cycle up for a few hours in the first half of today. Bears could cope (just) with sp'1310, but certainly the mini-H/S formation idea gets thrown out if we break a new high sp>1416.

*It remains important to note that other indexes - including the Rus'2000, already broke below the equivalent of sp'1395 yesterday.


Asking for too much?

Tomorrow we have the big monthly jobs data for April. The last time the number came out the main market was closed and only the Futures were open..and we saw a swift dow -150pt decline. What about tomorrow? I don't think its expecting too much to see at least 1385/80 tested on Friday. That would of course be a natural bounce zone, at least for 2-6 trading hours.
--

As usual..more throughout the day. Good wishes for Thursday trading!

Copper showed some distinct weakness today, whilst equities largely remained flat.


Copper, daily

Copper, weekly

Summary

The daily cycle is clearly ready to rollover. The big question is whether the weekly cycle is about to also rollover, and put in a much smaller tower/up cycle. If Copper can break below 3.70..and soon after..3.60, then it might be a prime sell signal for the broader equity and commodity markets.

Its certainly something to watch for the remainder of this week.

Goodnight from London

The Transportation Index remains the one to watch this summer. The 'Tranny' almost had a second consecutive +1% day. Lets take a quick look, especially at the bigger picture.


Transports, daily, rainbow (Elder Impulse -style)

Transports, monthly, bullish

Transports, monthly, bearish/doomster outlook

Summary

Key thresholds...
March high: 5390     
Recent trading range low: March: 5029

As I've been noting for some weeks now, the direction in which the transports breaks from its current 5 month range, will likely be a key indicator of where the broader market is headed. Keep on watching that Tranny!

The early morning falls certainly were largely negated today, we're almost back to 'business as usual' with the seemingly late-afternoon mini ramp, probably largely caused by those algo-bots.


IWM, daily, bearish outlook

SP, daily, bearish outlook

Transports, daily

NYSE Comp, daily, rainbow chart

VIX - bullish market scenario

Summary

Some very conflicting daily charts today, there are a few signs the market is still winding itself up -for a big move to the downside. The NYSE 'rainbow' chart (Elder Impulse) is suggesting that the little 6 day up cycle is coming to an end - posting the first blue candle.

The Transports were one of the strongest sectors today, and are again on the verge of breaking to the upside, I think I'll post more on that later. The Tranny...remains the sector to watch this summer.

I'm still looking for VIX to break 21...and then to 24. Even the bullish market outlook would surely allow for VIX to get at least a little spike higher later this month?

--
A little more. later this evening.

Market slowly crept upward into the close. For the bears, today was truly annoying, but if the mini H/S formation is correct, a break under 1394 should occur tomorrow or Friday. Its an interesting situation, and as noted earlier, the daily cycle does still offer a potential bearish scenario. The weekly/monthly cycles remain bullish of course.


Sp'60min

IWM'60min

IWM remains weaker than SP' again, and unlike the SP', IWM did break a new low this morning. This is one minor claim the bears can at least take from today.


Vix'60min

Not the most inspiring end to the day for the VIX, a barely 1% gain. From a cycle perspective, the VIX is looking weak again. An early Thursday morning drop in the VIX..very possible - matching up with the RS peak of SP'1405/10 ?

 --
Daily Cycle Update..later in the evening.

The mini H/S formation is still on track. Completion of the RS, with a fail at the hourly 10MA of sp'1403/04 would be ideal in the closing hour. Arguably, anything over 1410/12 would likely mean the scenario is wrong.


Sp'60min

*VIX is at least remaining marginally green right now.

More after the close!

Whilst the 60min cycle churns around - with no major moves in either direction, lets have a look at the daily cycle.


SP' daily, bearish outlook

The levels are clear for the bears...
Immediate term... <1395, then 1380
Near term.... <1357, then 1340, 1300

Key MAs to break,  10MA: 1389.    50MA: 1385

*It is interesting that two daily MAs are now right in the middle of the immediate target zone 1395-1380.

A break under 1380 will likely (if it occurs), produce a number of consecutive large down moves, I'd be looking for at least one 3% day, with VIX 21/24 eventually.


Finally..a brief chart update on the Sp'60min

The 10MA @ 1404 will be the first barrier. A fail there..and rollover into the close would be the very best the bears can hope for right now.


More later!

The market clearly floored on both the 15 and 60min cycles, the current 7pt bounce is to be expected - although of course its highly annoying to anyone still short. As ever, it is always about the power of the move, and right now the moves are just weak, the sub 20' VIX is testament to this idea. If we are going to break below 1357, we are likely going to need to see VIX break the 21 level.


SP'60min

So..am looking for a RS to form...1405/07 would be the ideal max' level. The fact that the 10MA is also around that level - currently sp'1406, would make for a nice place for the market to fail/rollover.

Maybe this micro-cycle can peak before today ends? That would at least make Thursday a little more bearish, and then we can await Friday for the more dynamic move..one way or the other.

The downside momentum was not enough to decisively break under the recent 1394 low. So,..up we go again.
Looking at the hourly cycle, are we setting up a mini head/shoulders formation? To confirm it, first we need a fail/rollover at the 1405/10 level...and then a swift move to break <1394. Its something to watch for as the day develops, and into Thursday. The RS - if that's what it will be, might take until late Thursday to fully form, and that would set up the major snap/fall under 1394 this Friday -when the big jobs data is released.


Sp'60min

From a MACD cycle perspective, we are already very low, and due a few hours to the upside.

Best guess right now...a move back to 1405/07...forming a RS, before a second attempt to break 1394, more likely tomorrow.

More later, its time for lunch!

Sp'1393 is not good enough for the bears. The bulls have effectively held the first line of defence this morning. Right now, bulls are getting a hammer off the 1394 previous low. This could be a disaster for the bears if we break above 1415. As ever, good trading stops are the answer to such unknowns.


Sp'60min

Not much to add right now, so far..bears do NOT have their break. I suppose we could back test the 10MA at 1405..before starting a second attempt to break <1394.
--

The daily cycle still looks potentially bearish, but more on that later!

An important morning ahead. With very poor ADP jobs data, market is getting an excuse for follow through to the downside. The natural cycle for the 60min cycle was inclined to be down anyway this morning (as I posted yesterday lunchtime)..so, this opening minor drop is not unexpected. The critical issue is whether we can break the recent low of 1394. I guess it could be said its not important for it to be done this morning - rather than by the close of today, but it will be much harder to do later. The bears need to see weakness down to 1390.. now!

*10am Factory Orders data: -1.5%  vs -1.6% expected


SP'60min

You can see the key levels, most important of all, bulls need to hold that 1385/80 zone...otherwise..real problems. However, low 1380s..even 1370s look an awfully long way down. There isn't the momentum right now to get this market lower, bears need more bad news!

*regarding the 1-5 count (in black). Its really just a vague guess. I suppose it could be right, but with the market as it is, its a VERY unreliable count. Only with a move <1380 would I say 'it was probably right..after all'.


Vix'60min

Bears really need to see VIX close in the 18s either later today or early Thursday.
-

Spanish IBEX is falling again, even clown channel was highlighting it just earlier. IBEX 6800..with around 1800pts to fall in the 'near term' - as I stated for some weeks now.

More later!

Good morning, those ADP jobs numbers sure are disappointing the market. Futures were -0.25%..now slipping to -0.75%. This is actually a little exciting, the key level remains 1395..and then 1380.

*ADP jobs data: 119k  (previous 209k) vs. expected 183k


SP'60min

Yesterdays last hour was pretty interesting, looking for good follow through this morning.

Bears need a lower low, preferably under 1390.
Bulls merely need to hold above 1395/1400..

A long day ahead...good wishes for Wednesday!

The Euro Currency appears ready for a major new down cycle. Both the daily and weekly cycles are now ready and able to begin a new down wave to around 1.25/24. I am tempted to wonder what news event/story might help precipitate such a move, but perhaps it'll just be a natural cyclical move lower.


Euro, daily

Euro, weekly

Summary

Just look at those MACD (blue bar histogram) cycles on both charts, they are both in the right position for a rollover this month. Even if it started today, it will take at least 3-5 trading days to know for sure if the trend is really changing.

Look for a break of 1.30. If that fails to hold as support, we should see at least a swift 5 cent move lower. In the scheme of things, that would only be a move of 5% from present levels, but it would certainly help to kick the Dollar upward, and that would put significant downward pressure on both equities and commodities (especially those precious metals!).

The rest of the week will be busy too...I think its time to rest.

Goodnight from the city of Green Shoots.