LunaticTrader

Investing with the Moon

Outlook for Week of August 31, 2015

Posted by Danny on August 31, 2015

Outlook for world markets with some comments for next week. Click the “Expand” button (bottom right) to watch in full screen mode.

The latest weekly reversal levels for over 1500 stocks and ETF can be found at www.ReversalLevels.com every weekend.

For shorter term trading and more optimal entries you can get our daily reversal levels, which are available every day as premium info on Scutify.com for just a few $. It covers over 1500 stocks from Dow Composite, Nasdaq 100, S&P 500, S&P 400 mid caps, S&P 600 small caps, and more than 100 popular ETF. Instructions for use are included. Give it a try.

If you have any trouble to see the presentation below, then you can also click here.

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

Ask me Anything

Posted by Danny on August 26, 2015

Just a quick post. I have been invited to give an “Ask me Anything” (AMA) session on Scutify today. So, you are all welcome to join with your questions about lunar cycles, the reversal levels, reading tea leaves, the future of the past, or anything else you always wanted to ask.

You can join at this link: Ask me Anything and if you are not registered on the site you can also log in with your Twitter or Facebook account. The session will start at the US market close today, 4pm EDT, but you can already enter your questions in advance and pick up the answer later if you are unable to join in at that time.

Looking forward to see you.

Danny

Posted in Announcements | Tagged: | 2 Comments »

Washout time

Posted by Danny on August 24, 2015

We got the first failed lunar period of the year and the market promptly followed through on the downside. I have been warning for it. Last month I wrote:

…we keep waiting for the first lunar cycle miss of the year. When it comes it will give us an important read on the market, as it will probably indicate the direction of the next major trending move in the markets and a departure from the mostly sideways trading we have seen since the beginning of 2015.

So, what’s next? Here is the current Nasdaq chart (click image to enlarge it):

Nasdaq

We remain in a lunar red period. Panic is engulfing the market with US futures indicating another 4-5% drop for stocks at the moment. And nothing suggests a bottom at hand in any of my indicators. My weekly and daily reversal levels are also bearish across the board.
The first thing to do now is wait and let the washout pass. A bottom may come today or tomorrow, but it could also take weeks or months. First indications that a bottom is in are likely to come from MoM indicator turning up, so that is what I would wait for. We may get several “false starts” before a proper rally gets going again. When markets are dropping fast it is better to buy too late than too early. Remember: this too will pass.
Also keep an eye on my reversal levels, which are posted on Twitter, Stocktwits and Scutify every day. In emotional market times an objective method is usually worth its weight in gold.

And if you are looking for something to blame, spare the Chinese or the Greeks. We can blame it on Saros cycle 125, something I warned for more than 2 years ago: The Saros cycle and the stock market. Saros cycle 125 has been bringing financial panics since the Tulip mania in Holland.

Danny

Posted in Financial Astrology, Market Commentary | Tagged: , , | 5 Comments »

Outlook for Week of August 24, 2015

Posted by Danny on August 24, 2015

Outlook for world markets with some comments for next week. Click the “Expand” button (bottom right) to watch in full screen mode.

The latest weekly reversal levels for over 1500 stocks and ETF can be found at www.ReversalLevels.com every weekend.

For shorter term trading and more optimal entries you can get our daily reversal levels, which are available every day as premium info on Scutify.com for just a few $. It covers over 1500 stocks from Dow Composite, Nasdaq 100, S&P 500, S&P 400 mid caps, S&P 600 small caps, and more than 100 popular ETF. Instructions for use are included. Give it a try.

If you have any trouble to see the presentation below, then you can also click here.

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

When the moon fails

Posted by Danny on August 17, 2015

Stock markets had a difficult week and we may be on track for the first failed lunar period of 2015. Failed lunar periods offer indications about underlying strength or weakness in the market. More on that in next week’s post, when we will know how the current green period has ended.
Let’s have our weekly look at the S&P 500 chart (click image to enlarge it):

S&P

The S&P sits right in the middle of the sideways channel it has been occupying since February. Technically the Earl (blue line) and MoM indicators are rather neutral and directionless. The slower Earl2 (orange line) has ever so slowly turned down from another weak peak.
This doesn’t help us much, but in a situation like this I would go with the Earl2 and stay very cautious until it shows a clear bottom. If the current lunar green period ends down, then it will also signal weakness, and then a sudden breakdown of the market is a scenario that needs to be taken more serious.
The 2050 level is really critical here. If we get a close below that level, then it could turn ugly very quickly. A target of 1900-1950 would be my first guess in that case. But, as long as the market stays above 2050 there is no reason for panic. There is also no reason for celebration as long as the S&P cannot break out above its May highs. Sideways ranges like this require a lot of patience. But a breakout is inevitable, so it’s good to be ready for it.

Danny

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

Outlook for Week of August 17, 2015

Posted by Danny on August 16, 2015

Outlook for world markets with some comments for next week. Click the “Expand” button (bottom right) to watch in full screen mode.

The latest weekly reversal levels for over 1500 stocks and ETF can be found at www.ReversalLevels.com every weekend.

For shorter term trading and more optimal entries you can get our daily reversal levels, which are available every day as premium info on Scutify.com for just a few $. It covers over 1500 stocks from Dow Composite, Nasdaq 100, S&P 500, S&P 400 mid caps, S&P 600 small caps, and more than 100 popular ETF. Instructions for use are included. Give it a try.

If you have any trouble to see the presentation below, then you can also click here.

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

Iceberg charts

Posted by Danny on August 10, 2015

It was a challenging week in the stock markets. Maybe we are due for the first failed lunar period of 2015.
In recent months I have been working on a new type of stock chart, with the intention of visualizing the market in an interesting new way. More on that further down this article. Let’s first take a look at the Nasdaq chart (click image to enlarge it):

Nasdaq

The Nasdaq had a nasty downturn in the last days of the week. Since the July record highs we see a lower low and a lower high on the chart, something we haven’t seen on this scale for quite a while. That doesn’t have to be the end of the world, but for me it is a good reason to turn into “show me” attitude. My technical indicators have turned back down, and now I just sit back and let the market prove to me that it has the strength to recover from this “dip”.
If it doesn’t then the chart will start looking ugly soon, because what looks like an intact up trend (as given by the blue channel) would quickly change into a visible down trend (shown by the red channel). That would mean a drop to 4700-4800 area, if not worse.
A move above 5200 would invalidate the potential down trend channel and tell us that the bull market is still on.
My weekly outlook based on reversal levels has also been giving warning signs for over a month. This may pass without much further damage, as it often does, but there is no way to tell. Even the worst of bear markets start with a few innocent looking down days.

***

I am a visual type of person and I like colors. A picture can say more than a thousand words, so I have been working on a type of stock chart that can give a better visual picture of what is going on. It is still a work in progress, but I already like the current result, so I am going to show some “iceberg charts” for the first time. Here is crude oil (click image to enlarge it):

Oil iceberg chart

There are no indicators or moving averages in this chart, they are not needed. The icebergs are the kind of landscape that you see at the bottom. A lot of information (and math) is packed in it, but presented in such a way that it becomes easy to “read” what is going on. The elements you find in the iceberg charts are:
1) Green mountains, covered with more or less ice (grey). The more green the more bullish the stock is behaving at that point. Stocks in healthy bull markets show plenty of green mountain, often uninterrupted for months. Some ice on the mountain is OK, but too much ice (and little green) means the continuation of the bull move is in question. If all green disappears it is usually better to sell the stock.
2) When there is no ice left on a mountain you see a red line (e.g. May 2015 in the chart), or “lava”. This indicates the market is very hot and probably at or near an important peak. A stock can stay hot for weeks, so don’t sell immediately. I usually sell half or all of the position as soon as the lava disappears.
3) Open water appears when no green mountain or even grey ice is present. This means the stock is dead in the water, bulls are too weak to take it higher and the stocks is probably grinding down (e.g. July 2014 in the chart). As you can probably guess, there is no good reason to own a stock that is dead in the water. We wait for green grass to tell us that a new bullish phase could be starting.
4) Sometimes you see icebergs in the water, small grey spikes without any green in them (e.g. Sep 2014 in the chart). Icebergs indicate that there is a rally attempt, but it is so weak that no green grass appears (no growth). Before you know it the stock is falling even further, if not sinking like the Titanic. Stay away from icebergs.
5) Small islands (e.g Oct 2014 in chart) are not much better than icebergs, usually followed by a further drop. But sometimes a small island is soon followed by a big green mountain, so they can be like the first green sprouts after a long winter.
6) In open water you will sometimes see floating ice (white lines in the blue water at the bottom, e.g. Aug 2014, Nov-Jan 2015 and Jul-Aug 2015). When you see floating ice it means hell is freezing over for the given stock. There is often floating ice at major bottoms, but not every case of floating ice is “the bottom”. If a stock is crashing it is best to wait until the floating ice disappears if you intend to buy near the lows. To play safe it is even better to wait for green grass if you want to buy after a period of floating ice.

Armed with this knowledge you can read stocks in a way that is not possible otherwise. You can quickly spot “regime change” in any market, you can see if a stock is red hot (lava), dead cold (floating ice), healthy green bullish or just dead in the water. Icebergs warn for possible dangers ahead. Here are a few more examples. Apple (click image to enlarge it):

Apple iceberg

Apple has been green bullish most of the time. It was dead in the water around the new year and has again gone dead in the water since May-June. You didn’t miss anything if you sold when the green grass disappeared.

S&P 500 (click image to enlarge it):

S&P iceberg

The S&P had lava in July last year, and saw floating ice at a few major lows. Since the start of 2015 the green bullish energy has been weak with plenty of small islands. An iceberg in June gave way to a quick dip and since July we see more green bullish. If this can be kept up then the market should go higher. If it doesn’t then the S&P will probably go dead in the water again.
I intend to post some iceberg charts from time to time, as it is a nice way to add some color to my articles. Hope you like them. Feedback is welcome as always.

Danny

PS: adding iceberg chart for FTSE 100 per reader question, see comments below.

FTSE 100 icebergs

Posted in Financial Astrology, Market Commentary | Tagged: , , | 7 Comments »

Outlook for Week of August 10, 2015

Posted by Danny on August 10, 2015

Outlook for world markets with some comments for next week. Click the “Expand” button (bottom right) to watch in full screen mode.

The latest weekly reversal levels for over 1500 stocks and ETF can be found at www.ReversalLevels.com every weekend.

For shorter term trading and more optimal entries you can get our daily reversal levels, which are available every day as premium info on Scutify.com for just a few $. It covers over 1500 stocks from Dow Composite, Nasdaq 100, S&P 500, S&P 400 mid caps, S&P 600 small caps, and more than 100 popular ETF. Instructions for use are included. Give it a try.

If you have any trouble to see the presentation below, then you can also click here.

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

The long sideways

Posted by Danny on August 3, 2015

Stocks had a fairly good week. The lunar red period is ending today, so this could be a good base to build on. The S&P 500 stays in a long sideways range that started in February. It is unusual for a major index to keep hovering within a narrow 5% range for so long. When the breakout comes, as it eventually must, it is likely to produce a big move. Here is the current chart (click image to enlarge it):

S&P 500

Technically the Earl (blue line) and MoM indicators are turning up from shallow bottoms. The slower Earl2 (orange line) is rather neutral but still going up from its early July lows. This looks pretty good as long as last Monday’s lows are not being revisited. Some people will see a reverse head and shoulders pattern in the price action since early June, and that would lead to more buying if the S&P can break above the 2140 resistance level. A move to 2300 is in the cards if that happens, because it would be a breakaway from the long sideways pattern. Long sideways patterns have slightly better odds of resolving in the direction of the long term trend, which is still up. But they can break down too, and in that case we would probably see a violent downturn. I am quite sure that some options traders are playing this with a strangle, in order to benefit from a big move either way.

It’s a new month, so time to get out the LT wave chart for August (click image to enlarge it):

LT wave

The LT wave had another good month in July as the expected strong period in the middle of the month panned out beautifully. For August a similar pattern is projected. After an hesitating start a strong period is expected until the 21st, followed by weakness in the final week. The highest value of the month comes on the 17th with the lowest LT wave value on the 25th. As always, bear in mind that this LT wave is experimental and past performance guarantees nothing.
I am working to add the LT wave into the Lunatic Trader program, which will give you the LT wave charts until the year 2100. So, stay tuned if you like these charts.

Danny

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

Outlook for Week of August 3, 2015

Posted by Danny on August 2, 2015

Outlook for world markets with some comments for next week. Click the “Expand” button (bottom right) to watch in full screen mode.

The latest weekly reversal levels for over 1500 stocks and ETF can be found at www.ReversalLevels.com every weekend.

For shorter term trading and more optimal entries you can get our daily reversal levels, which are available every day as premium info on Scutify.com for just a few $. It covers over 1500 stocks from Dow Composite, Nasdaq 100, S&P 500, S&P 400 mid caps, S&P 600 small caps, and more than 100 popular ETF. Instructions for use are included. Give it a try.

If you have any trouble to see the presentation below, then you can also click here.

Posted in Market Commentary | Tagged: , | 1 Comment »

 
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