LunaticTrader

Investing with the Moon

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 »

Investing is more about observing than forecasting

Posted by Danny on July 27, 2015

Markets turned down again last week. Potentially this paints a failed breakout in the Nasdaq, which surged to new all time highs last week but didn’t see any other major index follow in its footsteps. We remain in a lunar red period for another week, so a pullback was not unexpected. Now it is important to watch how deep this latest pullback will cut. If major support levels are broken things will not look good heading into autumn.
Some readers may wonder: last week you were talking about Dow 20k in August, and now you think stocks are headed down? Well, it’s always important to remember that investing is more about observing than forecasting. Working out possible scenarios of how the market will move next can be useful but has to be matched with unfolding reality at all times. If observed market action is no longer consistent with a given scenario, then I discard it or at least assign much lower odds to it. A climb to Dow 20k is still possible, but the odds if it happening in August is declining rapidly now. The basic condition for a new rally to start is the S&P 500 climbing above 2150, and that isn’t happening yet.

Let’s have a look at the Nasdaq chart (click image to enlarge it):

Nasdaq

The Nasdaq has quickly turned back from the 5200 level and is now testing support levels around 5090. Technically the Earl (blue line) and MoM indicators have turned down from significant highs. The slower Earl2 (orange line) is going up and breaking above the zero line. The Earl2 has struggled to get above zero since late March, so a continued rise would be a positive. But for that to happen the Nasdaq has to stabilize at current levels as soon as possible.
With the Earl and MoM coming down a further drop is easily possible and downside targets are 4950 and ~4750 if we get a more prolonged slide.

For the fans of my reversal levels, check out the latest weekly levels: http://www.reversallevels.com/2015/07/wrl-july-25.html

The daily reversal levels are available on Scutify as premium content every day: https://www.scutify.com/profiles/LunaticTrader

Posted in Financial Astrology, Market Commentary | Tagged: | 3 Comments »

Outlook for Week of July 27, 2015

Posted by Danny on July 26, 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 will the moon blink?

Posted by Danny on July 20, 2015

Stocks rallied strongly last week, and another lunar green period has ended with handsome gains. The lunar cycle keeps up its perfect record for the year. This is a highly unusual winning streak. If we consider the odds of correctly guessing the direction of the market over a given period at 50%, then getting it right 14 periods in a row has a 1 in 16384 chance. Just try tossing a coin until you get heads 14 times in a row.
Historically the lunar periods “work” about 60% of the time. Even if we consider 60% chance of success, getting it right 14 times in a row is a rare 1 in 1276 occurrence. So, it will probably take nearly 1000 years until a similar winning streak for the lunar green and red periods can be seen again.

A new lunar red period is now starting and 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.
Let’s have a look at the S&P 500 (click image to enlarge it):

S&P 500

After a false breakout to the downside the S&P is now climbing strongly. All my indicators are pointing up, but the Earl and MoM indicators are getting quite high already. The Earl2 has much more room to rise, so any pullbacks could be short lived. The June highs and the 2150 level are first overhead resistance for the S&P, and that’s where this rally could stop to take some breath.
But I wouldn’t be surprised if this becomes the period in which the moon blinks. Investors have been cautious for quite a while, and if the S&P pushes above 2150 then more money will come pouring in. Many traders are realizing that bonds are going to be rubbish in a rising rate environment, making selected stocks look more attractive as long as the economy keeps doing OK. If this comes to pass then the S&P can get to 2300, with the Dow pushing towards the magical 20k level in August.

Stay tuned.
Danny

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Outlook for Week of July 20, 2015

Posted by Danny on July 19, 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 »

Looking up

Posted by Danny on July 13, 2015

After another difficult Greece-dominated week stocks are trying to climb back. The lunar green period continues this week and that should support some kind of rally. Here is the current Nasdaq chart (click image to enlarge it):

Nasdaq

The market appears to have bottomed out last Wednesday. The Earl indicator (blue line) is turning up from a major low, while the slower Earl2 is still going down. The MoM indicator is turning up as well.
I think this setup bodes well for a rally to 5100, where some overhead resistance is likely. A drop below 4900 would clearly spell trouble.

For the fans of my reversal levels, check out the latest weeklies: http://www.reversallevels.com/2015/07/wrl-july-11.html

The daily reversal levels are available on Scutify as premium content every day: https://www.scutify.com/profiles/LunaticTrader

Danny

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

Outlook for Week of July 13, 2015

Posted by Danny on July 12, 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 »

What can rally stocks?

Posted by Danny on July 6, 2015

Stocks have been pressured by the uncertainty over the Greek referendum last week. Of course, the result of that vote was already available on Google trends days ago, as I suggested in my quick post yesterday. What kind of reaction can we expect this week? Let’s have a look at the S&P chart (click image to enlarge it):

S&P

We are now in a new lunar green period. The lunar cycle has maintained its perfect record so far in 2015. If it is to keep going for another period then stocks need to rally for some reason or other.
The S&P has fallen back to a long term support trend line. My technical indicators are all in bottom territory, but not turning up yet. So, there is potential for some rally to start in the next week. News from Greece can still swing the market either way, but I don’t think some kind of resolution can be postponed much longer. And any kind of “solution” may trigger a rally.

Danny

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

Does Google already tell us how Greece will vote?

Posted by Danny on July 5, 2015

A lot of eyes are on Greece today. How will the people vote in the referendum on the EU bailout diktats/proposals? Pollsters are telling us it is too close to call. But maybe there is a much easier way to foretell how this vote will go.
Google trends allows us to see which search terms are becoming more or less active/popular over time. So I used it to see what is happening for “oxi” and “nai”, the Greek terms we see in nearly every article on the topic. This is what it cranks out for search from within Greece (click image to enlarge it):

oxi_nai

Source: http://www.google.com/trends/explore#q=oxi%2C%20nai&geo=GR&date=1%2F2015%2012m

This shows the trends for the last 12 months. We can see that both search terms have shot up recently, which is not surprising of course. What is more surprising is that search for “oxi” has been significantly bigger than search for “nai”. This can have several reasons. Maybe there is a majority that is going to vote no (oxi) and that is being reflected in more Greek search hits. Or maybe the people who intend to vote yes (nai) do not use the internet as much as the no voters. That could be the case if a majority of older people intend to vote yes. Or maybe the truth is somewhere in the middle.
By tomorrow we will find out if Google trends offered a better indication than the opinion polls.

Danny

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

 
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