AstroCycle Analysis of 8/6/10
热4已有 143320 次阅读 2010-08-08 18:13AstroCycle Analysis of 8/6/10
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Similarities with the March to August 2004 Correction
The market similarities of 2003-04 and 2009-10 are probably in the minds of many and the choppy trading since the April 2010 high is not unlike the choppy trading we saw after the March 2004 high and some of the key dates match quite well and suggest a distribution top near 1100 into early August before a nasty decline into late September. This 2004-2010 fractal pattern agrees with the November 08 fractal which also suggests a distribution top near 1100 into early August before a similar decline into late September and they both predict a decline starting the week of Monday the 9th which is what the statistical Moon cycles above suggest.
Short Term Breadth is Neutral (0)
Medium Term Breadth is Neutral (+1)
Long Term Breadth is Bearish (-1)
The SPX is bearish below 1130 on Monday
The SPX broke down from the range as suspected from the lower highs in the top Tick lines and the fact that it looked more like a wedge than a bullish flag, but it rebounded strongly enough from the rising wedge near 1110 to reach 1131 if we can break above 1125-27. The top Tick lines are breaking a 4-5 day trend line but are not quite positive yet, and the lower Put/Call and white Trin lines are still bearish but somewhat oversold and turning a bit. The bottom blue PPO line made a low matching the July 29th low of 6 days ago and should send us higher into the New Moon, but the one day cycle visible the last 5 days suggest a pull back into mid-day Monday that could take us to 1115 and keep us from exceeding 1127-31 by mid-week.
See the NDX 1 minute chart here and the Dow 1 minute chart here
4 day low Tuesday?, 6 day high Wednesday?, 15 day low Thursday?
Since early June we have had three moves up-down-up of 8 days or so, but since the mid July high the trends have been cut in half to 4-5 days suggesting a low next Tuesday the 10th, unless we get a further division in half which is common in a completing wedge and finish this July rally with a 2-3 day rally towards 1131 into August 10-11th but we need to hold the lower wedge boundary near 1115 for that to happen. The top Tick lines have been on an 8 day cycle that suggest a low on Tuesday, but the rebound on Friday was quite strong and probably means another cut in half of the 16-8-4 day cycle and completion of the wedge mid week. The lower Put/Call and white Trin lines have been too volatile lately and not that useful except when they spike higher to warn us of an upcoming low, but they are trending in a bearish way for now. The bottom blue PPO line made a marginal new high that is still below the July 8th high but has yet to make a lower low than on July 29th or July 19th to signal the end of this July rally.
The SPX is overbought near resistance for the week ending August 13th
The SPX jumped to the 50% level from 2007 near 1121 last Monday but failed to reach the June high of 1131 and the upper wedge boundary all week which is a sign of weakness as seen in the lower high in the top Tick lines and the marginal break of the May trend line which held for 7 or 8 times and is overdue for a failure to hold. The lower Put/Call lines have been in a tight range near 0.85 for the last 4 weeks and the white Trin line suggests the next move out of the range will be higher which probably means a decline as the cycles show. The bottom blue PPO line is making lower highs since the July low but has yet to make a lower low to confirm a lasting change of trend and we will need to see a lower low than on July 21st before getting more bearish. New Moon lows usually come 2-3 days before and that is Friday the 6th while New Moon highs usually come 2-3 days after and we may get both this time around since the Moon cycles are synchronized that way this month.
See the NDX 10 minute chart here and the Dow 10 minute chart here
Outlook is mixed to bearish for August
The SPX reached the 50% level from 2007 and the April parallel channel fulfilling two major target for a possible top and only the June high of 1131 remains to keep us below the next targets of the wedge near 1150 and 1170. The top blue 10 day Tick line is acting a lot like it did at the April highs and it made a higher high divergence with the June high which is bearish for the Fall since it used up a lot of buying with little price gains so far, but until we break the May trend line we could still run to 1150 or 1170. The lower blue 15 day Put/Call line is not as low as it was in January or April and further gains are possible but the lower red 10 day Trin line is already headed higher and suggesting a larger down move. The bottom blue PPO line left a higher low divergence on July 1st and made a marginal higher high than in mid June which opens the door to a possible break of 1120-30 and a run to 1150-70 in August but I doubt it. The most likely count is bearish and implies we have completed 5 Waves from the March 09 low on April 26 which is a PI cycle of 3,142 days from 9/11, and have already finished the first Wave down of three that should take us to new lows by Fall 2011, and that means this fairly large counter trend rally should end in early August. The less likely alternative count is bullish and implies that the rally from the March 09 low is not over and another rally has started from 1,000 and will probably take us to marginal new highs by the end of 2010.
See the Nasdaq hourly chart here the Nasdaq 100 hourly chart here and the Dow hourly chart here
The Gold ETF will probably pull back to 115 from the 120 area in August
The USD will probably rebound to 82-83 from the 79-80 area in August
The 30 year Bond/TLT is wedging and bullish to 130-135 until it breaks below 125
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Summary
Last week I was divided on the outcome but the SPX made all of its gains on Monday and was range bound near 1120-30 until Friday as Plan "B" suspected. This week I expect the SPX to make a high below 1131 by mid week and decline to 1090 or even 1070 by Friday. Plan B has the SPX breaking above 1131 and reaching 1150 by Friday. |
Breadth Summation Indexes (BSI)
Daily BSI is Neutral since 2010-08-06 |
| The SPX is overbought near resistance for the week ending August 13th The SPX jumped to the 50% level from 2007 near 1121 last Monday but failed to reach the June high of 1131 and the upper wedge boundary all week which is a sign of weakness as seen in the lower high in the top Tick lines and the marginal break of the May trend line which held for 7 or 8 times and is overdue for a failure to hold. The lower Put/Call lines have been in a tight range near 0.85 for the last 4 weeks and the white Trin line suggests the next move out of the range will be higher which probably means a decline as the cycles show. The bottom blue PPO line is making lower highs since the July low but has yet to make a lower low to confirm a lasting change of trend and we will need to see a lower low than on July 21st before getting more bearish. New Moon lows usually come 2-3 days before and that is Friday the 6th while New Moon highs usually come 2-3 days after and we may get both this time around since the Moon cycles are synchronized that way this month. See the chart here Outlook is mixed to bearish for August The SPX reached the 50% level from 2007 and the April parallel channel fulfilling two major target for a possible top and only the June high of 1131 remains to keep us below the next targets of the wedge near 1150 and 1170. The top blue 10 day Tick line is acting a lot like it did at the April highs and it made a higher high divergence with the June high which is bearish for the Fall since it used up a lot of buying with little price gains so far, but until we break the May trend line we could still run to 1150 or 1170. The lower blue 15 day Put/Call line is not as low as it was in January or April and further gains are possible but the lower red 10 day Trin line is already headed higher and suggesting a larger down move. The bottom blue PPO line left a higher low divergence on July 1st and made a marginal higher high than in mid June which opens the door to a possible break of 1120-30 and a run to 1150-70 in August but I doubt it. The most likely count is bearish and implies we have completed 5 Waves from the March 09 low on April 26 which is a PI cycle of 3,142 days from 9/11, and have already finished the first Wave down of three that should take us to new lows by Fall 2011, and that means this fairly large counter trend rally should end in early August. The less likely alternative count is bullish and implies that the rally from the March 09 low is not over and another rally has started from 1,000 and will probably take us to marginal new highs by the end of 2010. See the chart here We have probably seen the high of the year for the 30 month cycle in January-April All indicators turned down for the 30 month cycle high of April 2010 and have broken support that held since the March 09 lows suggesting we have seen the highs of the year and a lasting break of the February lows would confirm. We had a series of 4 month lows or a bit less and closer to 114 days starting with the February 27, 07 high, but the lows have been late or early by a week lately and the highs are not as reliable which means the August 2nd high could be delayed by a week or more before we decline towards the lower channel near 900 or worse into the Fall. All indicators turned up from the June 8th low and the top red McClellan and lower blue Put/Call lines are already crossing into the bullish zone, but the top blue Tick line is still below and the lower red Trin line is heading down in a bearish way from the 114 day cycle high and the other indicators will likely follow soon. The 30 month cycle has marked many important double tops and bottoms in the last decade and correctly suggested a January and April double top like we saw 4 x 30 months 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 May and August 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 chart here | |
Moon, Cycles and More
Overbought New Moon likely a high
New Moons are statistically bullish and the Moon cycles point to an August 9-11 high, but the blue Tick line is already breaking the July trend line suggesting a high could come at any time and take us down into the next Full Moon of the 24th. |
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Similarities with the March to August 2004 Correction
The market similarities of 2003-04 and 2009-10 are probably in the minds of many and the choppy trading since the April 2010 high is not unlike the choppy trading we saw after the March 2004 high and some of the key dates match quite well and suggest a distribution top near 1100 into early August before a nasty decline into late September. This 2004-2010 fractal pattern agrees with the November 08 fractal which also suggests a distribution top near 1100 into early August before a similar decline into late September and they both predict a decline starting the week of Monday the 9th which is what the statistical Moon cycles above suggest.
Safe Blue Chips or Risky QQQQ Chips?
The Dow has consistently been a Safe Haven as it declines less in Bear markets and an over performing Dow is a sign someone is getting defensive. The opposite is true with the QQQQ which tends to overperform the most near tops and the QQQQ have been outperforming for the last 18 months setting up ideal conditions for a sharp crash like move down into the next PI cycle low of early 2011. |
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The expected 3 year cycle of August-September is upon us and looks to be a low
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The Geometry and PI which made April 26,10 significant points to a September low
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The next 4 year cycle low is due near September 2010The next 3,142 days or 8.6 year PI cycle low is due in June 2011The 10 year cycle of highs in 87, 97, 07 and lows of 82, 92, 02 is due in 2012The 40 year cycle of highs in 29, 69, 09 and lows of 34, 74 is due in 2014
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Market Breadth
Short Term Breadth is Neutral (0)
The top Ticks are turning bearish from overbought but still near trend lineThe lower Put/Call is bullish but the white Trin is turning bearishThe PPO is turning bearish but the StochRSI is turning up again
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The New Highs are bullish but the Lows with Ratio are turning bearish
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The Up and Down Volume are flat but the Ratio is turning bearish
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The 40 day Trin is bearish but the 5 days are still bullish but stalling
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Medium Term Breadth is Neutral (+1)
The Volatility is bullish by breaking the channel but stalling near the 22 level
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Stocks above their 50/200 day MA are bullish but turning a bit
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Stocks on a Point and Figure buy signal are bullish but stalling a bit
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The McClellans turned bullish from a double bottom but the top A/D turned bearish
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The top Trin line turned bullish from very oversold but no break higher in price yetThe middle Put/Call line is bullish but stalling just below trend and the Bear market lineThe lower Tick line is bullish but stalling just above the Bear market resistance line
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Long Term Breadth is Bearish (-1)
The red Nyse and Nasdaq Down Volume crossed above the blue Up volume in a bearish way
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The Cumulative New Highs and Lows are bearish but turning up againThe McClellan Summation turned positive but the StochRSI is still negative
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Gold is bearish and the Yield Curve is still critical but the US Dollar is improving
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Equities
The SPX is bearish below 1130 on Monday
The SPX broke down from the range as suspected from the lower highs in the top Tick lines and the fact that it looked more like a wedge than a bullish flag, but it rebounded strongly enough from the rising wedge near 1110 to reach 1131 if we can break above 1125-27. The top Tick lines are breaking a 4-5 day trend line but are not quite positive yet, and the lower Put/Call and white Trin lines are still bearish but somewhat oversold and turning a bit. The bottom blue PPO line made a low matching the July 29th low of 6 days ago and should send us higher into the New Moon, but the one day cycle visible the last 5 days suggest a pull back into mid-day Monday that could take us to 1115 and keep us from exceeding 1127-31 by mid-week. See the NDX 1 minute chart here and the Dow 1 minute chart here
Click for Printable Chart 
courtesy of StockCharts.com
4 day low Tuesday?, 6 day high Wednesday?, 15 day low Thursday?
Since early June we have had three moves up-down-up of 8 days or so, but since the mid July high the trends have been cut in half to 4-5 days suggesting a low next Tuesday the 10th, unless we get a further division in half which is common in a completing wedge and finish this July rally with a 2-3 day rally towards 1131 into August 10-11th but we need to hold the lower wedge boundary near 1115 for that to happen. The top Tick lines have been on an 8 day cycle that suggest a low on Tuesday, but the rebound on Friday was quite strong and probably means another cut in half of the 16-8-4 day cycle and completion of the wedge mid week. The lower Put/Call and white Trin lines have been too volatile lately and not that useful except when they spike higher to warn us of an upcoming low, but they are trending in a bearish way for now. The bottom blue PPO line made a marginal new high that is still below the July 8th high but has yet to make a lower low than on July 29th or July 19th to signal the end of this July rally.
Click for Printable Chart 
courtesy of StockCharts.com
The SPX is overbought near resistance for the week ending August 13th
The SPX jumped to the 50% level from 2007 near 1121 last Monday but failed to reach the June high of 1131 and the upper wedge boundary all week which is a sign of weakness as seen in the lower high in the top Tick lines and the marginal break of the May trend line which held for 7 or 8 times and is overdue for a failure to hold. The lower Put/Call lines have been in a tight range near 0.85 for the last 4 weeks and the white Trin line suggests the next move out of the range will be higher which probably means a decline as the cycles show. The bottom blue PPO line is making lower highs since the July low but has yet to make a lower low to confirm a lasting change of trend and we will need to see a lower low than on July 21st before getting more bearish. New Moon lows usually come 2-3 days before and that is Friday the 6th while New Moon highs usually come 2-3 days after and we may get both this time around since the Moon cycles are synchronized that way this month. See the NDX 10 minute chart here and the Dow 10 minute chart here
Click for Printable Chart 
courtesy of StockCharts.com
Outlook is mixed to bearish for August
The SPX reached the 50% level from 2007 and the April parallel channel fulfilling two major target for a possible top and only the June high of 1131 remains to keep us below the next targets of the wedge near 1150 and 1170. The top blue 10 day Tick line is acting a lot like it did at the April highs and it made a higher high divergence with the June high which is bearish for the Fall since it used up a lot of buying with little price gains so far, but until we break the May trend line we could still run to 1150 or 1170. The lower blue 15 day Put/Call line is not as low as it was in January or April and further gains are possible but the lower red 10 day Trin line is already headed higher and suggesting a larger down move. The bottom blue PPO line left a higher low divergence on July 1st and made a marginal higher high than in mid June which opens the door to a possible break of 1120-30 and a run to 1150-70 in August but I doubt it. The most likely count is bearish and implies we have completed 5 Waves from the March 09 low on April 26 which is a PI cycle of 3,142 days from 9/11, and have already finished the first Wave down of three that should take us to new lows by Fall 2011, and that means this fairly large counter trend rally should end in early August. The less likely alternative count is bullish and implies that the rally from the March 09 low is not over and another rally has started from 1,000 and will probably take us to marginal new highs by the end of 2010. See the Nasdaq hourly chart here the Nasdaq 100 hourly chart here and the Dow hourly chart here
Click for Printable Chart 
courtesy of StockCharts.com
We have probably seen the high of the year for the 30 month cycle in January-April
All indicators turned down for the 30 month cycle high of April 2010 and have broken support that held since the March 09 lows suggesting we have seen the highs of the year and a lasting break of the February lows would confirm. We had a series of 4 month lows or a bit less and closer to 114 days starting with the February 27, 07 high, but the lows have been late or early by a week lately and the highs are not as reliable which means the August 2nd high could be delayed by a week or more before we decline towards the lower channel near 900 or worse into the Fall. All indicators turned up from the June 8th low and the top red McClellan and lower blue Put/Call lines are already crossing into the bullish zone, but the top blue Tick line is still below and the lower red Trin line is heading down in a bearish way from the 114 day cycle high and the other indicators will likely follow soon. The 30 month cycle has marked many important double tops and bottoms in the last decade and correctly suggested a January and April double top like we saw 4 x 30 months 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 May and August 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. |
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Commodities
Oil went parabolic, but Gold and others have yet to follow like in 1920, 1980 and 2040?
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The CRB should pull back towards 220 into the Fall for the 10 and 24 month cycles
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The CRB should rebound to 300-20 by the 5.5 year cycle high of late 2011
The 55 year Kondratiev cycle in Commodities gave us lows in 1822, 1877, 1932, and 1987 but we have revisited the 200 level from 1986 in 1992, 1999, 2001 and even 2009 which is a sign this bullish K-Wave in Commodities into the next projected high of 1812, 1867, 1922, 1977 and 2032 should be weaker than previous ones. |
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Oil should decline to the 50-60 area for the 11, 24 and 20 month cycle lows
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Oil should decline to 50-60 from the 5 year cycle high of September 2010
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The Gold ETF will probably pull back to 115 from the 120 area in August
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The Gold ETF is building a wedge which should give us a low above 110 in August
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Gold should pull back to the 1150 level and probably 1050 by Fall-Year end
Tom O'Brien mentioned a target of 1075 on CNBC in late May and Gold will probably pull back to the 1000-50 area by September-November for the 8 and 22 month cycle lows before making new highs in 2011 for the 8 year cycle high of January 2012, but it could also go deeper and reach the previous high of 875 should there be a panic to raise cash like in November 08. |
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A #1 Gold Timer Digest - Tom O'Brien calls for a top in Gold on CNBC in late May
Tom O'Brien made a call for a top in Gold on CNBC in late May and since he is #1 Gold Timer Digest we should take his warning of a pull back to 1075 seriously and he is right to be cautious. Any call for a top may be premature until we break below the 1150 level and we already saw marginal new highs since his call, plus we have two cycles of 11 months and 40 weeks due the week of July 16th suggesting a low and the 1150 level is still holding. 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 by the 8 year cycle high of January 2012, even though the real end of the Gold Bull should only come with the 40 year cycle high of 2020. It is not unusual to pull back to the previous all time high near 875 before the next big move up and since we have not really done that in a clear way, it should happen in late 2010 before the last move up into January 2012. |
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Silver will probably pull back to 17 from the 18 area in August
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Silver should top near 20 by January 2010 for the 11-22 month cycle highs
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Gold Stocks should drop to 120-30 by Fall for the 7 and 28 month cycles
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Gold Stocks will probably decline to the 100 level into 2011 along with the market
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Currencies
The Yen is strongest since 1950 and is probably in a multi-year Bull market
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The USD will probably rebound to 82-83 from the 79-80 area in August
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The USD should decline to the 75-80 area s for the 15 month and 4.25 year cycles
The US Dollar turned down from the 90 area for the 4.25 year cycle high of June 2010 and will most likely pull back deeply into the 70's and even make new lows if we keep following the early 1995 + 17 = early 2012 pattern for a low. |
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The USD should pull back deeply as it did one 17 year cycle ago
The current period in the 17 year cycle is a lot like the early 1990's and the US Dollar 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 drop to the 88-90 area by the Fall for many cycle lows
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The CDN Dollar should pull back to the 77-80 area for the 16 year cycle low of 2018
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Bonds and Rates
The 30 year Bond/TLT is wedging and bullish to 130-135 until it breaks below 125
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