LunaticTrader

Investing with the Moon

Pendulum market

Posted by Danny on August 18, 2014

Fears rise on Friday, next they ease on Monday…, a pattern we have been seeing for weeks. Like a pendulum swinging. Will it continue that way? It is quite possible. Just like last week, I remain mildly positive about the market as long as each relief rally goes a little higher than the previous one. That’s how walls of worry get climbed.
Let’s have a look at the S&P 500 (click for larger image):

S&P 500

The rebound has taken the S&P to double overhead resistance. Earl and MoM indicators turned up from major bottoms a week ago, and now the slower Earl2 is at the point of turning up as well. Technically, a further rally to 2000+ is easily possible, but of course not guaranteed.
A failure to climb above 1970 would not bode well for the market and a decline below 1910 would confirm a second move to the downside.

Good luck,
Danny

 

Posted in Financial Astrology, Market Commentary | Tagged: | Leave a Comment »

Key reversal levels for week of August 18, 2014

Posted by Danny on August 17, 2014

Our key tables and comments for this week, now in slideshow format. Click the “Expand” button (bottom right) to watch in full screen mode. Click on “Slideshare” (bottom left) if you want to save and print it.
If you have any trouble to see the presentation below, then you can also click here.

Good luck, Danny

 

Posted in Market Commentary | Tagged: | Leave a Comment »

Bending but not breaking

Posted by Danny on August 11, 2014

Stock markets were clearly under pressure most of the week. But Friday’s rally pushed the S&P and Nasdaq into the green for the week. That’s quite remarkable given the news stream. Looks like somebody is buying. The market is bending but not breaking.
Let’s have a look at the Nasdaq (click for larger image):

Nasdaq

Nasdaq has been building a base near 4325 with 5 touches in the last 6 trading days. Can it now rally from this level?
My Earl indicator is turning up from a triple bottom and the slower Earl2 is entering bottom territory but not turning up yet. MoM indicator is close to the blue depressed zone, but also not turning up yet. This means a rally from current levels is certainly feasible. And we will be starting a new lunar green period later this week.
On the downside, the blue long term trend line is an important hold, currently around 4300. Market may continue in muddle through mode until this blue line gets touched. If the 4300 level doesn’t hold the market then a further drop to 4000 becomes very likely.

All in all I am mildly positive for the next few weeks, and the scenario for a climb to 4500+ is still valid. A close below 4300 would cloud the outlook significantly.

Good luck,
Danny

 

Posted in Financial Astrology, Market Commentary | Tagged: | Leave a Comment »

Key reversal levels for week of August 11, 2014

Posted by Danny on August 11, 2014

Our key tables and comments for this week, now in slideshow format. Click the “Expand” button (bottom right) to watch in full screen mode. Click on “Slideshare” (bottom left) if you want to save and print it.
If you have any trouble to see the presentation below, then you can also click here.

Good luck, Danny

 

Posted in Market Commentary | Tagged: | Leave a Comment »

The next breaking point

Posted by Danny on August 4, 2014

In our most recent review of the S&P 500 we pointed out the market was at a breaking point, with all my indicators pointing down. US markets have indeed gone over the edge last week, and the rather quick drop has brought them right to the next breaking point. Here is the current S&P chart (click for larger image):

S&P 500

The S&P has dropped to support at long term trend line (green line) near 1930. Will buyers appear at this level? Maybe, maybe not. None of my technical indicators show any sign of a bottom at this point, but that could change if the market manages to hang on to this 1925 level for several more days. Clearly, the prospect for new highs in August, as we discussed in last week’s post, is now a more remote scenario.
Meanwhile, the Nasdaq sits right at the 4350 level, the July lows. This keeps the possibility alive for another run to 4500+… IF buyers show up this week.
Bottom line: both the S&P 500 and the Nasdaq are at a next breaking point. And the technicals still look poor. I think the odds for a rebound or sideways “hanging-on mode” are fairly equal to the odds of a quick further drop this week. If the current support level gives way then I would look for 1880 and then 1730 as likely downside targets for the S&P 500. If buyers show up at these levels then this will be another whipsaw move that is quickly forgotten.

Good luck,
Danny

Posted in Financial Astrology, Market Commentary | Tagged: , | Leave a Comment »

Key reversal levels for week of August 4, 2014

Posted by Danny on August 3, 2014

Our key tables and comments for this week, now in slideshow format. Click the “Expand” button (bottom right) to watch in full screen mode. Click on “Slideshare” (bottom left) if you want to save and print it.
If you have any trouble to see the presentation below, then you can also click here.

Good luck, Danny

 

Posted in Market Commentary | Tagged: , , , , , | 2 Comments »

LT wave chart for August

Posted by Danny on August 1, 2014

The LT wave chart for July did OK. It picked up a few highs and lows, also missed some. Here is the LT wave for August (click for larger image):

LT wave

Given yesterday’s drop in the market it could become an interesting August. The LT wave will reach a low on the 5th, followed by a high on the 10th. Then another low around the 20th before going into a strong final week. As always, consider this chart with the necessary caution. It is an experimental method.

Good luck,

Danny

Posted in Financial Astrology, Market Commentary | Tagged: | Leave a Comment »

Setting up for an August peak

Posted by Danny on July 28, 2014

US stock markets have been fairly flat in July, neither breaking down nor breaking out to the upside. The current lunar green period will end Wednesday. So far it looks like a rather weak green period, but we have a few more days to go.
The upcoming red period will contain a supermoon. Over the last 60 years supermoon red periods have on average been rather positive for stocks, unlike normal red periods. See my article: http://lunatictrader.wordpress.com/2013/06/24/trading-the-super-moon/.
Does that mean the market will climb even higher? We cannot rule it out. Sometimes the market does go down in supermoon periods, but more often it goes up. Note: in the media you may read that we are having three supermoons in a row (July – September). Technically that’s true, but for my research I consider the one that comes closest to Earth and for this year that is the August supermoon.

Let’s have a look at the Nasdaq to see what could be in store (click for larger image):

Nasdaq

Nasdaq is clearly hesitating near overhead resistance lines. Even though it feels like a bull market, we can see that this could be an ongoing sideways pattern that started last December, trading above and below 4200 alternatingly. If so, then a drop back to 3950 could come next.
Technically, my slower Earl2 indicator continues to point down, but the shorter term Earl is more positive and also MoM has turned back up after touching the zero line. This means we could first reach the 4530 level that my price target algorithm has been pointing out since the middle of March.

Taking a closer look for further clues (click for larger image):

Nasdaq

Prices have been contained within a nice channel that started in late April. With both Earl and MoM in rather neutral territory and the market in indecisive mode, we will continue to grind sideways inside the pink triangle until there is a clear breakout, up or down. That could give us a 4530 high print, as that’s where the overhead resistance (grey dashed line) lies for the coming weeks.
On the downside I watch the July lows ~4350. A break below that level would tell many traders that the trend has turned down, and would probably trigger significant selling with the 3900-4000 area as the first downside target.

Good luck and stay tuned,

Danny

Posted in Financial Astrology, Market Commentary | Tagged: , , | Leave a Comment »

Key reversal levels for week of July 28, 2014

Posted by Danny on July 27, 2014

Our key tables and comments for this week, now in slideshow format (click on “Slideshare” if you want to watch in fullscreen, or save and print it).
If you have any trouble to see the presentation below, then you can also click here.

Good luck, Danny

 

Posted in Market Commentary | Tagged: , , | Leave a Comment »

At the breaking point

Posted by Danny on July 21, 2014

US markets tried to rally last week, but didn’t succeed to print new highs, with the exception of the Dow Industrials. The market appears heavy, but hasn’t really broken down yet, so a further grind to marginally higher highs is still possible. Let’s have a look at the S&P 500 (click for larger image):

S&P 500

The market is right a breaking point. A narrow 3 month up trend channel supports the market at current levels, but any drop below 1950 would not bode well. On the upside a +2000 print remains possible, and would become inevitable if this narrow trend channel is to hold up for another month.
Meanwhile my technical indicators continue to point downwards, and the weekly MoM for the S&P has now turned down as well. So, this is not a setup I want to buy or stay heavily long. At best we are in a sideways correction, but the risk for a sudden downside acceleration is quite high. We have been in a higher highs and higher lows pattern since mid April. Once that sequence ends the S&P will drop 100 points quickly imo, much like it did in January.

Good luck,

Danny

Posted in Financial Astrology, Market Commentary | Tagged: , , | 4 Comments »

 
Follow

Get every new post delivered to your Inbox.

Join 371 other followers

%d bloggers like this: