To put this in perspective, we are currently correcting a Grand Supercycle. This is 1 degree higher than a Supercycle. YIKES!

Weekend Chart Update

Here is a weekly look at the SPX. There are a few things that I want to point out. First, notice that price exceeded the 161.8% 2 bar price projection (KoolsTools). This generally signals that price will complete its projection to the 261.8% level @ 819, although, never a certainty. Coincidentally or not, this lines up very well with the H/S measured move. This projection is good until it is either reached or negated by price exceeding the high.

Secondly, we have time cycle lows (KoolsTools) that are not due for 2 more weeks (denoted by blue 1 and 6). This does not mean that price has to go down. It is saying that when the cycle comes due there should be an upward bias to price that follows. This can happen from price higher or lower than where it is currently. There is additional time cycle relationships with fibonacci as well.

Lastly, notice the big inverse H/S pattern that could potentially setup with lower prices. If my big picture scenario is correct - this would be perfect. Scare the bejeezers out of the bulls, crush retail (again!), and get a bunch of shorts to pile in for the fuel to send us on our last zigzag higher. May just be wishful thinking.

Here is my current count. It's my belief that we are in the process of tracing out an X wave (dark red). At completion, we would have one more ABC structure up. The alternative is that we have completed this bear rally and have started back down.

Take a look at RSI. This is looking just like it should in an intermediate topping process. Another reason I favor the downside in the next few weeks.


It appears that we have completed a W and X and are in the process of working on a Y. Correctives in general can be difficult to discern. It "looks" right to me though.

I am hoping for a better retrace of the 928.25 H to complete B (white). A minimum satisfactory level would be the 38.2%, which comes in at 889.25. AB=CD at 888, while the 127.2% sits at 893.25 with the 161.8% at 900.

Crude continued getting pounded this past week. This witch had lost over $15 at its lows. I hope someone out there took advantage of this easy layup.

It printed a 58.72 low, which is very close to its 2:1 fib projection of A and right in the middle of its 4th of lesser degree (and my profit target box). Has C completed? Based on my count, the answer is no. However, my count might very well be wrong. One of my big concerns is that the fib relationship is getting extremely stretched for a flat. Having completed 5 is my alternate.


Here is my count on the subwaves of C. It appears to me that 3 actually ended at the 59.25 L. This would mean that price is tracing out an expanded flat for 4. My best guess is that this 4 will be complex and probably trace some ugly combination. This of course assumes we are indeed in a 4.

For those of you traders that are unfamiliar with this market, I would encourage you to take a serious look at it. It is a money making market and a scalpers paradise!


The yellow metal just does not look bullish to me here. This is Prechter and gangs view as well. I do have an alternate at the bottom, which would be invalidated with price taking the 867 level.






The 30yr has started its bounce in earnest, as expected. I would expect this market to continue working higher over the near-term.






The dollar's pattern sure looks and acts like its in a 4. Maybe it has finished its structure down, but does this look like a 1 and 2? Not to me either.





The magical fruit. Well, beans caused me to change my count with that big gap. I'm now wondering if I had it right the first time. I am leaving as is for the time being. Very nice volatility for those that trade this market.



Purely speculative count on wheat, as I'm unsure of the bigger picture. But, it sure looks like some type of racer X wave.

Crude

Early crude action has been to the downside. This sorta surprises me. Not nescessarily breaking the lows, but it appears to be impulsive action. Anyway, here is what my
Ensign Map is showing for todays action.

ES finished off a clean 5 wave structure during globex. That was as exciting as it got. We finished correcting that upmove around 10:15 CST. The majority of the day saw a slow grinding, what appears to have been, an ending diagonal to complete a C up. They sold the last hour.

The total range on the day was a measly 10.75 points. Volume contracted sharply from yesterday. Not what you want to see if your bullish.

I have changed my count (again) because I do not believe that we have finished C down at the 865.25 L. There are basically 3 counts (actually more) I feel may be in play:

1.) We have finished our ABC down from the 953.50 H. This would complete an intermediate X wave. We have started back up the rally.

2.) We completed our rally from the March 6 lows and its time for the "Great Bear" to return and crush everything in its path. This means that we have completed 1 down 2 up and are in the beginning stages of 3.

3.) We have not finished the ABC from the highs as of yet. We have completed A down and B up and are still working on C (to complete X). The 865.25 L completed a smaller degree A and we have started working on a smaller degree B with C to follow.

I'm in camp #3. This means that the H/S will play out to whatever degree it does. Maybe it makes its entire measured move. Maybe its just 1/2, or maybe it goes beyond the measured move. We will just have to see.

What happens at that point? It's my opinion that the market traces out a triple zigzag. We have completed 2 of them. Wherever X ends, we should have 1 more ABC to the upside and then this pig is done because 3 corrective zigzags are all that is allowed.

Short-term I'm bullish until B completes.


Here is an inverse H/S on the 60m chart that bears watching.













Here is the daily update of our bigs and smalls.

Crude

Crude continued its decline early in the session as was discussed yesterday. This appears to have finished off a nice 5 wave structure, while setting new corrective lows in the process.

My current count has crude completing 3 of C. This means that we should see some messy action for the next few days as it works on a 4 wave. Based on the price action so far and wave 2's structure, I'm looking for a flat or triangle to trace out. The above assumes that 3 finished at 59.25. It is entirely possible that we ended 5 (my alternate count).

There is no question that this witch is in need of a retrace, having been down 6 of the last 7 days and reaching (and surpassing) the 261.8% fib projection of wave 1. We have also reached wave 4 of lesser degree. I believe we have started that retrace process.

The chart to the right shows the nice RSI divergence that is in place. We have rallied nicely off that divergence thus far.

Virgin POC's

For you market profilers. This chart is messy, but the blue lines that extend to the far right side (white numbers) are virgin poc's (point of control).

I have to admit, I have not paid a whole lot of attention to them in the past. You can use them as support and resistance levels, much like pivot points.

Are they worth a damn? Not sure, but it worked like a charm today. Something else to watch.

ES

ES started out slowly in a little corrective, but soon gathered speed to the downside in impulsive fashion as expected. We found support at a virgin POC (point of control) from 5/1 while finishing our structure. From there GS goosed her into the close.

We had a 18.25 point range today - basically in line with our recent average. Volume expanded again today for our biggest volume day since 6/10 and well above the 20 day average.

Have we really finished C down? That's the question. You will notice that I have question marks next to my cyan subwaves. Well folks, we either have indeed finished C or something else is in play - like we just finished 1 down. Whatever this pos structure down we had, it appears finished.

The bounce we had off of 65.25 sure looks impulsive to me. We have had 5waves up with no overlap. That doesn't mean the downs are done necessarily. This could be an ABC corrective. 898.25 will be the tell. If price trades above this number then the downs are more than likely finished. That's the line in the sand.

Here is how the bigs and smalls fared (sorry for the line in the middle).











Here is a 15m RTH chart with the H/S neckline. Notice the battle that has taken place at that level, which is very much expected, by the way. I suspect we haven't seen the last skirmish at this level.

Crude

Crude registered its 6th losing day in a row, as its C leg puts on a clinic of how a C is supposed to behave. I'm still short-term bearish until the blue channel is broken, which will be when its 4 wave takes place (if it hasn't already). I will then connect 2 with 4 for another channel.

If the count is right, crude would have one more little leg down to complete 3. At that point, we should see a messy 4 based on 2's apparent simple zigzag. The alternate is at the bottom in white.

ES

Here is an ES update. Not exactly sure what the current count should be. In the attached chart, you will see that the wave I have labeled 4 has overlap with wave 1. This is no good. That led me to believe that we were not in a C leg down, but instead part of an expanded flat. It can not count as a ending diagonal either. Is it possible that 1 ended at 75.25? Just not sure folks.

Regardless, it appears that we have finished a little 5 wave structure off the 883.50 H. The labeling may not be the right degree. As of now, we are working on a 5 wave structure up. This will be an A or 1. Let's see how this pig unfolds.

Crude

Wanted to show this nice little setup from the crude pits today. We broke out of a corrective channel, which told us it was ready to resume its trend (down). Proceeded to come backtest the underside of the channel line where it was rejected. This is a money trade.

ES

Total range on the day was 23 points, slightly higher than our recent average, while volume expanded from yesterday.

It appears that B up was completed in globex and we have started C down. We should finish off 1 down either in globex or early in the session tomorrow. The 1:1 fib projection comes in at 852. If this indeed is a bonafide C leg of a zigzag, I would expect price to exceed the 1:1.

Is this a C leg down? Well, I have some doubts, however, based on the information we currently have, we have to assume it is. One issue I have is that B is very undersized for its degree. And obviously we didn't get much of a retrace - less than 38.2%. One valid possibility, is that B up is an A leg of an expanded flat and this is not a C leg but a B instead. We will have to let the structure determine what it is.

Here is a snap shot of my volume chart showing "bigs" (>100) and "smalls" (<100). Notice the smalls were selling from the gitgo, however, the bigs didn't cut loose until around 12:30 pm CST. In fact, they had accumulated about 20k contracts at their high point before finishing around -30k. Looks like they both covered some into the close.

Edit: Failed to mention that tonight is a full moon. You are suppose to sell rally's and buy sell-offs into moons. You can learn more about that here.

Crude

Crude appears to have finished its 4 wave of some degree from yesterday. It looks like it has either a ending or leading diagonal (red trendline). Looking to sell with break of corrective channel (silver).

ES

Has ES finished its B up? Not sure at this point, however, the action looks impulsive to the downside. What has me bothered is that we didn't even get a 38.2% retrace of A.

Here is a chart of my 610T (trading chart) with my channel line. No need to even begin to think about long positions until this is broken.

Crude

Here is todays crude action. Spent the whole day in a corrective. Looks like we had a nice ABC up for A followed by a B flat and it appears to be working on C. This C leg is really looking puny. I would not be surprised to see this trace out as a triangle. It appears that we have already seen 2 B wave triangles in this consolidation.






I'm not entirely confident in my subwaves for this leg down, but I am fairly confident this is a 4 wave. To what degree is the question. If I am right, crude should see another wave down to complete 3.

ES

The bounce got under way as expected, although, from lower levels than anticipated. It appeared that the structure down was complete entering globex last night. Unfortunately, there was another leg down.

We actually pierced the H/S neckline and traded below it before SPX found support at its 200 sma and the bounce started. It took a couple try's before we managed to retake the neckline. It appears that we have started a corrective ABC off the 882 lows and it does not appear impulsive.

I have serious problems with the flat I have labeled (cyan). The C leg looks just too big to be a part of a flat, having gone to about the 261.8% projection. There also seems to be too many waves (thats why I thought we had a completed structure last night). I'm guessing that it is probably a zigzag, which means that more than likely we have a complete structure from 884.25 to 928.25. I have changed this probable zz to an A.

I have also changed my labeling in red to reflect this (in order of preference). I still have the 2 on the chart, but I am fairly convinced that will not play out (yet). I do not believe we have finished our bear rally. My best guess (and thats what it is) is that we will trace out a triple zigzag.

Bottom line is that we should see continued strength in the market until the B up is finished. Targets would be the 38.2% @ 899.75 up to the 61.8% @ 910.50. Regardless of what price B ends at, C down will follow.


Here is an update to my globex trades. I was long @ 90.25 (88.6%) thinking we had a completed structure down. Wrong. Took a stop under the low @ 88.50 for a small loser.

However, I put a buy order in before I went to bed @ 883.50. This was the 161.8% and where a Bullish Crab would turn if the pattern played out. It did and I took 1 off at 887.75 and the other @ 890.25.

Crude

Crude appears to have put in a B wave triangle in early action. I took another 1/4 off of my USO puts for $2.50 profit. We MAY have ended 3 of C, however, its way to early to tell. If we have, I would expect a retrace back to at least the 23.6%, but more than likely the 38.2% just under 67.

Weekend Chart Update

Does the Head & Shoulders pattern play out? The pattern is clearly in place and setup, now we need to see follow-through. You will notice that in limited Friday trade, ES bounced off the neckline. What I would like to see is a break of the neckline and price to take out the 6/23 low of 884.25 on a close. If that happens, we should find some support in the 870's from the May lows and we conveniently have the 78.6% fib projection @ 874.50. A retrace up to backtest the broken neckline would allow for a nice short entry.

That would be the ideal setup, however, I wouldn't count on it being that easy. It might very well find a 3 of 3 and blow through all that support and never look back. That's assuming the pattern plays out to begin with, which is a big assumption.

Targets? The measured move comes in around 820. The fib projections start at 859.75 (100%) and work down to 817.50 (161.8%). We have additional support from the triangle apex @ 833.25 and the bottom of the X wave @ 819 from 4/21. I'm going to take a WAG and say we find our way down to the 840's.


Here is my current count. It appears that we have indeed finished our downleg, which I have labeled C (cyan) and finished an EWT flat. Sort of a weird structure as there was next to nothing of the 2 and 4 waves. Nonetheless, I believe it is complete. My preferred count would require price to trace out a "triple three", or basically another ABC, which is a rare pattern. I'm very unsure of this count and have my alternate at the bottom of the chart.



It appears as though we may be tracing out a B wave triangle. We clearly have a 5 wave A (white) up. Regardless if this ends up being a triangle or we have completed an EWT flat, price should start to head higher for our C (white) up. When globex opens, I will be looking to get long.


This weeks MP for you profilers.













Crude started its 3 of C in earnest last Thurday. Still short crude via my USO July 40 puts.















































This chart is to show the monthly pivots.

Federer Wins #15

This is a big deal sports fans. Congrats!