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AstroCycle Analysis of 5/14/10

1已有 4712 次阅读  2010-05-16 21:29
AstroCycle Analysis of 5/14/10  

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Summary

Last week I expected the SPX to rebound to the 1150 area into mid-week and decline towards 1100 by Friday but we went as high as 1070 as Plan B suspected. This week I expect the SPX to make a low on Monday near 1090 or test the crash lows by Thursday. Plan B has the SPX holding the 1110 level and rallying towards 1170 by Friday.

The SPX is bearish below 1150 on Monday
Most crashes see a deep retest of the crash lows within weeks but this one was more like the 100 point drop and recovery of April 4, 2000 which led to much deeper lows by the 14-17th of April, and the decline we started last Friday could give us an ugly drop early this week too. The 7 and 3.5 day cycles are suggesting a low on Monday and the top white Trin and Put/Call lines are certainly high and oversold enough to fuel a good rebound, but the lower Tick lines did not get deeply oversold and as long as we stay below 1150, the risk remains of making further lows near 1110 and/or 1095 which is the last stop before testing the crash and February lows near 1050.

Monday the 17th (big low?), late Tuesday (high?), late Wednesday (low?), late Friday (high?)
The best fit for the last month is close to a 7 and 3.5 day cycle that is suggesting a big low mid day Monday, then a rebound into late Tuesday for the 3.5 day cycle high and another probably milder decline into late Wednesday for the 3.5 day cycle low, which should give us another move up on Friday the 21st. Every event in the Credit Crisis has been on a 1/16 Harmonic of the 3,142 days PI cycle or about 196 days which gave us the August 17, 07 Countrywide event, the March 17, 08 Bear Sterns event, the September 17, 08 Lehman event, April 17, 09 was a dud and October 17, 09 was the mild Dubai event, but the Greece event came on May 6th and is either over or will be this week with another possible large drop like the 200 point drop of April 14-17, 2000, and another 17th as seen in the
chart here . The top white Trin line is high and suggesting a low soon, but the top Put/Call lines peaked one day and many points before the SPX did on May 5th and we should be careful until all indicators turn bullish and we break above 1150. The lower Tick lines are getting oversold and turning up a little, but are still short of recent lows and could support one more drop into the 7 and 3.5 day cycle low of mid Monday.

Trend is mixed for Expiration week ending May 21st
The SPX rebounded early last week for the New Moon and the April 4, 2000 spike pattern as suspected and even turned on a dime last Friday to start the deep retest of the crash low that is common after crashes of all sizes, and the 1090 area would be typical although in 2000 we dropped 200 points and that would take us to 970 this week by the 2 year anniversary of the May 19, 08 high. The top white Trin line has been oversold for a while and a warning a low can come soon, but the top Put/Call lines may be starting a fifth bearish wave up from an impulsive looking parallel channel and will need to break that channel to turn bullish. The lower Tick lines are bearish but near the first bullish support line and could turn up here, especially since the StochRSI is still positive and this makes forecasting this week difficult. I suspect we will get a volatile week with both moves up and down as traders try to figure out where we are going next and market makers even out their positions to bring their book closer to home. The most likely bearish count is that we have completed 5 Waves from the March 09 low on April 26 which is a PI cycle of 3,142 days from the opening day after 9/11, and are now probably in the last Wave 5 of the first Wave down of three that should take us to new lows by Fall 2011, and that means one more low before we have a fairly large counter trend rally into June. The alternative bullish count is that the rally from the March 09 low is not over and another rally will start from support above 1000 and probably take us to marginal new highs by the end of 2010.

Outlook is bearish but getting oversold enough for a low in May
The SPX did move to the 1100 area as I suspected in May, and even had a flash Crash mini Panic that some signatures were pointing to into mid May, but the Credit Crisis cycle will be over Monday the 17th leaving the door open for a low to form and a rally to develop going into June for the 7 week cycle high. We could make a low on Monday the 17th, or Thursday the 20th which is the 2 year anniversary of the May 19, 08 high, or even next week for the Full Moon of the 27th for the 4 month cycle, but the lower channel near 1110 is the first bullish support with 1090 the last level keeping us from testing the flash crash and February lows near 1050. The top blue Tick line is bearish and looks to be in a fifth wave down which implies this move down will probably be the last for a while as the lower blue Put/Call and red Trin lines are as high and oversold as they were at the February lows. The 4 month cycle of lows has been apparent since the first March 17th, 08 PI cycle low, which then gave us the July 15th low, followed by the November 21st low, the March 6th low, the July 8th low but the February 5th low was one month early and the next low may be in early June or early July, with late May early June more likely since we are getting very oversold already.

Breadth Summation Indexes (BSI)

Short Term Breadth is Neutral (-1)
Medium Term Breadth is Bearish (-3)
Long Term Breadth is Neutral (0)

Daily BSI is bearish since April 16-10
but one more good day from bullish
Weekly BSI is bearish since April 27-10
Yearly BSI in a Bear Market since January 4-08
but getting close to a Bull Market






We are probably seeing the high of the year for the 30 month cycle in April
All indicators have turned down for the 30 month cycle high of April 2010 and are getting close to the area of support where previous bullish trends started since the March 09 low, and if we break these support lines and the February lows it will confirm that we have probably seen the highs of the year. While the lower blue Call/Put and red Trin lines are almost at their support lines, the top blue Tick and red McClellan Summation lines are not quite there and we should decline some more in May to make them more oversold. Some of the support lines are only half way to the very oversold conditions we can see in a bear market and since we should resume the bear soon, those first support levels may not hold for long. The top red McClellan Summation line should make a lower than it did in early February, which itself was lower than the one made in early November, and since there was about 14 weeks between the November low and the February low, we could see a low by mid May for that cycle, although the 4 month cycle suggest weakness into June as well. The 30 month cycle which has marked many important double tops and bottoms in the last decade is suggesting a January and April double top like we saw 4 x 30 month cycles ago in 2000, but also 30 months ago in July and October 07, which was a mirror image of the July and October lows of 2002 exactly 2 x 30 months before. From this high, we should decline into a double bottom in April and July 2011 and those dates fall around the PI cycle low date of mid June 2011 when anchored with the crash of 1987, or mid July 2011 when anchored with the crash of 1929.

Cycle Summary
The 2.5-5-10 year cycle suggests an April 10-13 cycle high in optimism and has been regular from July 1982. -  A Deep 4/8 year cycle low is expected from the the deep Fall lows of 1982, 90, 98, 2002 and 2010. -  An 8.6 year PI cycle low is due from the crash of the CRB into 1986, Nikkei 94, USA-Euro 2002 and Many in 2011? -  A Deep 10/20 year cycle low is usual in years like Jul 1932, Apr 42, Jun 62, Aug 82, Jul 2002, and 2012 or 2022? -  This Bear Market is expected to make new lows by Fall 2010 for the 2, 4 and 8 year cycle lows and/or by Summer 2011 for the PI 8.6 year cycle low.

Moon, Cycles and More


New Moon acting like post crash Moon

New Moons are statistical highs but when they invert into a low can cause a panic under the right conditions, and the low often comes a few days before with a sharp rebound into the New Moon which then usually heads back down for a deep retest like in 1987 or new lows like we saw in April 2000. In either case, we should make a low this week and head back to retest the 1050 area as a minimum.

See a
larger Moon chart here


Typical Crash behavior calls for a deep retest

Wall-Street would like you to believe that the Flash Crash was caused by a glitch and things will return to normal but in fact what happened is not uncommon at major tops and actually happened already at the top in 2000 with Saturn and Uranus at 90 degrees just like they are at 180 degrees now and part of that rare Cardinal Climax formation. There was no glitch on Tuesday April 4, 2000 to explain a 100 point drop and an 80 point recovery, and any glitches may have been the catalyst, but were not responsible and so far the rebound has been weaker than in 2000 with a drop of 3.5 pts a day vs. 3 pts a day in 2000 and we all know the outcome was not good in 2000 and could be worse in 2010.



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The Price-Time Geometry and PI make April 26,10 potentially major

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The next 3,142 days or 8.6 year PI cycle low is due in June 2011

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The next 4 year cycle low is due near September 2010

The next 8.6 year PI cycle low is due near June 2011

The 10 year cycle of highs in 87, 97, 07 and lows of 82, 92, 02 is due in 2012

The 40 year cycle of highs in 29, 69, 09 and lows of 34, 74 is due in 2014

courtesy of StockCharts.com

Market Breadth


Short Term Breadth is Neutral (-1)


The top Put/Call and white Trin are turning bullish but stalling in oversold

The lower Ticks are turning bearish from overbought levels near New Moon and Cycle

The StochRSI and PPO are turning bearish but still near and above middle line

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The New Highs and Lows with ratio are turning bullish from very oversold

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The Up and Down Volume with ratio are turning bearish from partly overbought

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The 5 and 40 day Trin are bearish but the 5 day are turning in very oversold

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Medium Term Breadth is Bearish (-3)


The top Trin line turned bearish by breaking trend lines and can climb some more

The middle Put/Call line turned bearish from a double bottom but is close to resistance

The lower Tick line turned bearish from an overbought spike but is near recent support

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The Volatility is still bearish above trend line but turning down from a cycle date

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Stocks above their 50/200 day MA are turning bullish from previous low

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Stocks on a Point and Figure buy signal are bearish but turning near previous low

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The McClellans are bearish but turning near trend line support

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Long Term Breadth is Neutral (0)


The Nyse Down Volume is crossing above the Up volume in a bearish way but the Nasdaq not quite

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The Cumulative New Highs and Lows are bullish and still climbing

The McClellan Summation is headed down but the StochRSI is just turning

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The Yield Curve is improving, but the US Dollar and Gold are warning of market dislocations

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Equities


The SPX is bearish below 1150 on Monday

Most crashes see a deep retest of the crash lows within weeks but this one was more like the 100 point drop and recovery of April 4, 2000 which led to much deeper lows by the 14-17th of April, and the decline we started last Friday could give us an ugly drop early this week too. The 7 and 3.5 day cycles are suggesting a low on Monday and the top white Trin and Put/Call lines are certainly high and oversold enough to fuel a good rebound, but the lower Tick lines did not get deeply oversold and as long as we stay below 1150, the risk remains of making further lows near 1110 and/or 1095 which is the last stop before testing the crash and February lows near 1050.
See the
NDX 1 minute chart here and the Dow 1 minute chart here

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courtesy of StockCharts.com



Monday the 17th (big low?), late Tuesday (high?), late Wednesday (low?), late Friday (high?)

The best fit for the last month is close to a 7 and 3.5 day cycle that is suggesting a big low mid day Monday, then a rebound into late Tuesday for the 3.5 day cycle high and another probably milder decline into late Wednesday for the 3.5 day cycle low, which should give us another move up on Friday the 21st. Every event in the Credit Crisis has been on a 1/16 Harmonic of the 3,142 days PI cycle or about 196 days which gave us the August 17, 07 Countrywide event, the March 17, 08 Bear Sterns event, the September 17, 08 Lehman event, April 17, 09 was a dud and October 17, 09 was the mild Dubai event, but the Greece event came on May 6th and is either over or will be this week with another possible large drop like the 200 point drop of April 14-17, 2000, and another 17th as seen in the chart here . The top white Trin line is high and suggesting a low soon, but the top Put/Call lines peaked one day and many points before the SPX did on May 5th and we should be careful until all indicators turn bullish and we break above 1150. The lower Tick lines are getting oversold and turning up a little, but are still short of recent lows and could support one more drop into the 7 and 3.5 day cycle low of mid Monday.

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Trend is mixed for Expiration week ending May 21st

The SPX rebounded early last week for the New Moon and the April 4, 2000 spike pattern as suspected and even turned on a dime last Friday to start the deep retest of the crash low that is common after crashes of all sizes, and the 1090 area would be typical although in 2000 we dropped 200 points and that would take us to 970 this week by the 2 year anniversary of the May 19, 08 high. The top white Trin line has been oversold for a while and a warning a low can come soon, but the top Put/Call lines may be starting a fifth bearish wave up from an impulsive looking parallel channel and will need to break that channel to turn bullish. The lower Tick lines are bearish but near the first bullish support line and could turn up here, especially since the StochRSI is still positive and this makes forecasting this week difficult. I suspect we will get a volatile week with both moves up and down as traders try to figure out where we are going next and market makers even out their positions to bring their book closer to home. The most likely bearish count is that we have completed 5 Waves from the March 09 low on April 26 which is a PI cycle of 3,142 days from the opening day after 9/11, and are now probably in the last Wave 5 of the first Wave down of three that should take us to new lows by Fall 2011, and that means one more low before we have a fairly large counter trend rally into June. The alternative bullish count is that the rally from the March 09 low is not over and another rally will start from support above 1000 and probably take us to marginal new highs by the end of 2010.
See the
NDX 10 minute chart here and the Dow 10 minute chart here

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courtesy of StockCharts.com


Outlook is bearish but getting oversold enough for a low in May

The SPX did move to the 1100 area as I suspected in May, and even had a flash Crash mini Panic that some signatures were pointing to into mid May, but the Credit Crisis cycle will be over Monday the 17th leaving the door open for a low to form and a rally to develop going into June for the 7 week cycle high. We could make a low on Monday the 17th, or Thursday the 20th which is the 2 year anniversary of the May 19, 08 high, or even next week for the Full Moon of the 27th for the 4 month cycle, but the lower channel near 1110 is the first bullish support with 1090 the last level keeping us from testing the flash crash and February lows near 1050. The top blue Tick line is bearish and looks to be in a fifth wave down which implies this move down will probably be the last for a while as the lower blue Put/Call and red Trin lines are as high and oversold as they were at the February lows. The 4 month cycle of lows has been apparent since the first March 17th, 08 PI cycle low, which then gave us the July 15th low, followed by the November 21st low, the March 6th low, the July 8th low but the February 5th low was one month early and the next low may be in early June or early July, with late May early June more likely since we are getting very oversold already.
See the
Nasdaq hourly chart here the Nasdaq 100 hourly chart here and the Dow hourly chart here

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We are probably seeing the high of the year for the 30 month cycle in April

All indicators have turned down for the 30 month cycle high of April 2010 and are getting close to the area of support where previous bullish trends started since the March 09 low, and if we break these support lines and the February lows it will confirm that we have probably seen the highs of the year. While the lower blue Call/Put and red Trin lines are almost at their support lines, the top blue Tick and red McClellan Summation lines are not quite there and we should decline some more in May to make them more oversold. Some of the support lines are only half way to the very oversold conditions we can see in a bear market and since we should resume the bear soon, those first support levels may not hold for long. The top red McClellan Summation line should make a lower than it did in early February, which itself was lower than the one made in early November, and since there was about 14 weeks between the November low and the February low, we could see a low by mid May for that cycle, although the 4 month cycle suggest weakness into June as well. The 30 month cycle which has marked many important double tops and bottoms in the last decade is suggesting a January and April double top like we saw 4 x 30 month cycles ago in 2000, but also 30 months ago in July and October 07, which was a mirror image of the July and October lows of 2002 exactly 2 x 30 months before. From this high, we should decline into a double bottom in April and July 2011 and those dates fall around the PI cycle low date of mid June 2011 when anchored with the crash of 1987, or mid July 2011 when anchored with the crash of 1929.
See the
Nasdaq daily chart here and the Dow daily chart here
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courtesy of StockCharts.com

Commodities


Oil went parabolic, but Gold and others have yet to follow as seen in 1920, 1980 and 2040?

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The CRB/DBC should bottom near the 88 and 96 highs of 255 in May

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The CRB should turn down near 290 for the 17-18 month cycle high

Commodities are close to the 2006 lows near 290 and should turn down into the first half of 2010 from the 17-18 month cycle high, but the pull back is likely to be shallow.
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Gold follows the Moon lately but the next Full Moon may invert into a high

Gold has been making highs and lows about 3 days before the Moons and we are probably in a pullback that normally would end about 3 days before the next Full Moon and that is the 24th. However Moons can invert, especially when the pattern gets too obvious like this one and we may get an inversion here since both the 6 week and the 11 trading day cycles point to a high for the Full Moon. If the Gold ETF holds 119 it is in a very bullish position to make new highs, but it will need to break 116 this week to cancel the parabolic bullish trend and break the 2009 trend line near 111 to turn really bearish and reach the 1075 target that Tom O'Brien mentioned on CNBC.

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The Gold ETF should reach 122, 125 or 128 in May for dual cycle highs

Gold is acting a lot like it did 5.5 months ago or the 1/24th Harmonic of the 11 year Solar cycle, and the 1/96th Harmonic which is the 6 week cycle is suggesting a high for Options Expiration of the 21st and 24th. The current level of 122 is a Fib extension of the first move from 102 to 112 and could be the high, but 128 is the next Fib extension plus a geometric target and more probable, while the 125 level is only a geometric target and may only cause a pause. The 6 week cycle argues for a pull back into the 11 month cycle low of mid June and the next 6 week high to be near the July 4th Holiday on our way to a probable Cardinal Climax mid August 2010 high for the 5.5 year, 8 month and 6 week cycle high.
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Price and Time meet the Geometry and Fibonacci near 1300, 1370 or 1400

The geometry is pointing to 1300 by early June and if W5 = W1 we have a 1370 target and if W5 = W3 we have a 1400 target which is also a geometric target by June but that cycle has been off by a week or two in the past and is an 11 month cycle low, so it may end up being a short and sharp pull back as discussed above. The 8 month cycle is the most reliable since the July 2008 high when the credit crisis escalated and probably pushed many into Gold. The next 8 month cycle high is in early August and dead in the middle of the Cardinal Climax which I discussed previously here and could give us the parabolic move to the Fibonacci extension of 1500 and finally get that Barron's cover that Gold is no longer a relic but a modern day Wealth protection investment vehicle.
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A #1 Gold Timer Digest - Tom O'Brien calls for a top in Gold on CNBC

Tom O'Brien made a call for a top in Gold on CNBC and since he is #1 Gold Timer Digest we should take his warning seriously and he is right to be cautious. However the best fit for long term Fibonacci extensions from the 1999 low with the September 1980 and May 2006 highs of 735, the March 2008 high of 1033 and the 1980 previous all time high is suggesting 1500 as a possible end to the 10 year move up and it looks like it should reach it before the next 8 year cycle high of 2012, even though the real end of the Gold Bull should only come with the 40 year cycle high of 2020.
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Silver should struggle near the highs in May

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Silver should top near 20 by January 2010 for the 11-22 month cycle highs

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Gold Miners should struggle near the highs in May

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Gold Stocks should top near 200 and drop to 120-30 from the 28 month cycle high

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Oil/USO will probably break below 80 into May and eventually reach 65 by June

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Oil should turn down from the 06 highs of 80 and the 30 year cycle high of 09

Oil is between the 75-85 levels which have marked the 100, 200, 400, and 800% gains from the 1999 low, and a logical place to turn for the 30 year cycle high. The most probable count is that the almost 10 year rally from early 1999 to late 2008 is over and Oil will correct for a minimum of 25 to 50% in time, or 2.5 to 5 years into 2011 to 2014, but the 36 level will probably hold.
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Currencies


The Yen is probably in a multi-year Bull market

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The USD will probably pull back a bit from the 0.85 level into early June

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The USD should top near 85-90 for the 4.25 year cycle high of June 2010

The US Dollar turned up from support near 74 and is acting a lot like in December 1991 where it rallied for a few months before turning down to make new lows and we should see the dollar rally towards 83 into May for the 4.25 year cycle high. The current period in the 17.2 year cycle is a lot like the early 1990's and we could test and even breach the 70 area in 2010 if we continue to follow the pattern.
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The Yen should rally towards the 115-123 area in 2010

The Yen pulled back sharply from the recent highs and middle channel resistance near 115, but will probably rally again in 2010 to test the highs or even reach the all time highs of 123 by mid or late 2010 for the 17.2 year PI cycle high.
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The Yen should reach 123 for the 17.2 year PI cycle high of late 2010

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The CDN Dollar should top below 100 and drop towards 85 into mid 2010

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Bonds and Rates

The 30 year Bond/TLT will probably reach the 125-30 level in May

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The 30 year Bond made an early low and should rally towards 130-35 by year end

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The 30 year Bull Market in the 30 year Bond is coming to an end

The evolving 30 year top in the 30 year Bond is looking a lot like the 20 year top in Gold in 1980 and suggesting Bonds will make their secondary high this Summer or Fall and start declining into 2011 and beyond, but probably not breaking the key 100 level until well into 2011.

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