Friday, July 30, 2010

Guesstimates on July 30, 2010

September S&P E-mini Futures: Today's range estimate is 1080-1098. The market will resume its move to 1145-50 today or Monday. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Thursday, July 29, 2010

Update

Here is a 30 minute bar chart showing 24 hour e-mini trading over the past week.

I thought support at 1099 would hold but in the event sellers hit the market hard and have driven the ES down to 1089 so far. I think the drop from Monday's high at 1119 is corrective and is proceeding in a stack of 18 point boxes (blue rectangles). The ES has dropped to the midpoint of the second box ( dash blue line) and I think that it will rally close to the high of this box before dropping to the low of the box near 1082. The midpoint of the rally from 1051 on July 20 to 1119 stands at 1085 (red dash line) while the 1084 level was a prominent low on the way up from 1051 (green dash line). So my target zone for the low of this correction is 1080-85 (green oval).

I expect to see this low in the next day or so. It should be followed by a resumption of the swing up to 1145-50.

Sold long at 1099.75

Long one unit at 1104.50

Guesstimates on July 29, 2010

September S&P E-mini Futures: Today's range estimate is 1103-18. The market is headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Wednesday, July 28, 2010

Guesstimates on July 28, 2010

September S&P E-mini Futures: Today's range estimate is 1102-18. The market is headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Tuesday, July 27, 2010

Update


Here is an hourly bar chart which updates the daily chart I discussed a week ago.

The e-minis are continuing the swing up to the initial target of 1145-50. That zone is the confluence of the upper channel line (green dashed lines) and the midpoint of the second 96 point box of this uptrend. In the meantime I think the top of the first box at 1099 will act as support for the market.

I believe that the S&P 500 is in the early stages of a move upward that will carry it to 1300 and above over the next 8 months.

Guesstimates on July 27, 2010

September S&P E-mini Futures: Today's range estimate is 1106-20. The market is headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Monday, July 26, 2010

Cocoa

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on July 26, 2010

September S&P E-mini Futures: Today's range estimate is 1092-1108. The market is headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Friday, July 23, 2010

Guesstimates on July 23, 2010

September S&P E-mini Futures: Today's range estimate is 1082-1100. The drop from last week's ended at Tuesday's 1050.75 low. The market is now headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Thursday, July 22, 2010

Revised range estimate: 1078-1097

Guesstimates on July 22, 2010

September S&P E-mini Futures: Today's range estimate is 1070-1090. The drop from last week's 1099 high ended at Tuesday's 1050.75 low. The market is now headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low made July 5.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Wednesday, July 21, 2010

sold long at 1076.00

Long one unit at 1076.00

Guesstimates on July 21, 2010

September S&P E-mini Futures: Today's range estimate is 1075-1094. The drop from last week's ended at yesterday's 1050.75 low. The market is now headed for 1145-50. I think that a new upward leg in the bull market started from the 1003 low.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Tuesday, July 20, 2010

Revised range estimate: 1053 (already in place) to 1069

Update

Here is a daily chart of the September e-minis. I think that the 1002.75 low in early July ended the drop from the April 26 high. The first leg up nearly matched the size of the rally from the May 25 low at 1032 to the June 21 high at 1129 and established the initial 96 point box of the new uptrend (lower blue rectangle). A three day drop has carried the ES down to the midpoint of the first box (lower blue dash line). This midpoint is also in the general vicinity of three previous lows (horizontal green dash lines).

I am guessing that today's low at 1050.75 will hold, but even if it doesn't the worst I see on the downside is 1035 or so. Assuming today's low does hold I have drawn an upward sloping trend channel. A similarly paced advance from today's low would carry the second up leg to the 1145-50 zone, the midpoint of the second box, the level that would match the size of the first up leg, and a point near the upper channel line (green oval).

Guesstimates on July 20, 2010

September S&P E-mini Futures: Today's range estimate is 1045-1065. The drop from last week's high at 1099 should end today or tomorrow. I still think that a new upward leg in the bull market started from the 1003 low.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Monday, July 19, 2010

Times and Tribune Tidbits

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on July 19, 2010

September S&P E-mini Futures: Today's range estimate is 1055-1075. The drop from last week's high at 1099 should end near 1050 early this week. I still think that a new upward leg in the bull market started from the 1003 low.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is now at 85.50.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 450 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Friday, July 16, 2010

Today's low is now estimated to be 1064

Revised range estimate 1070-1085

Out at 1081.75

Long one unit at 1085.75

Guesstimates on July 16, 2010

September S&P E-mini Futures: Today's range estimate is 1085-1102. A new upward leg in the bull market started from the 1003 low.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Thursday, July 15, 2010

Update


Here is an hourly chart showing 24 hour trading in the e-minis. The market has bounced off the initial target near the descending red trend line around the 1100 level. It has dropped about 23 points from its high this morning made after the initial employment claims number came out. This is just a tad less that the previous biggest reaction of 25 points (blue rectangles). Today's low (thus far) is just a couple of points above the rising green dash trend line. So I think the market is going to be supported near 1075 (lower green oval) and then begin another swing upward.

The next upside target is roughly 1130 (higher green oval). That level is near the top of the rising trend channel and at the level of the June 21 high of 1129.75 (horizontal red dash line). It is also worth noting that 1127 is the midpoint of the 2007-09 bear market which dropped prices from 1587 to 666.

I think the ES is in the very early stages of an extended up move. I think this move upward will last into the first part of 2011 and carry the S&P 500 to at least the 1340 level.

I now think the day's high has been seen and that the low will be near 1075

Guesstimates on July 15, 2010

September S&P E-mini Futures: Today's range estimate is 1085-1102. A new upward leg in the bull market started from the 1003 low.

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

September Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - September Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Wednesday, July 14, 2010

Guesstimates on July 14, 2010

September S&P E-mini Futures: Today's range estimate is 1083-1100. A new upward leg in the bull market started from the 1003 low. Initial target is 1100 or so

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Tuesday, July 13, 2010

Elliott

Elliott wave theory has become very popular in the wake of the 2008-09 financial crisis. Lots of Elliott wave blogs have sprung up and most of them focus on the U.S. stock market averages.

I have mixed feelings about Elliott's wave theory. On the one hand it can sometimes enable one to construct spectacularly correct market forecasts. On the other, it offers too much scope for personal prejudice and bias to influence the wave count. For this latter reason I don't find it much of much use in my day-to-day market activities.

In my view the top two Elliott wave interpreters of the last 60 years were Hamilton Bolton and Charles Collins (sadly, both now deceased). They shared one important attitude towards Elliott's theory. Each believed that one should not expect the small details of the price movement to fit the theory exactly. Instead they emphasized the importance of looking only at the big picture, especially if it just jumps out at you from the chart.

The chart above this post shows the cash S&P from the start of the current bull market on March of 2009 at the 666 level. I have traced in green the first upward leg of the bull market which divided clearly into a classic, five wave Elliott pattern. Elliott's theory asserts that a five wave movement up from a low such as was seen in March 2009 is never a completed bull market. Instead it will be followed by a three wave corrective movement, and then by at least one more, five wave move up to new highs.

The drop from the 1219 level of the April 26, 2010 high subdivides into a classic, three stage, "flat"correction: three smaller waves down to the May 25 low, then three smaller waves up to the June 21 high, and finally a fast, scary movement down to the final low of the correction at 1010. I have traced this wave sequence for you in red.

Not only is the wave pattern of this correction exceptionally clear, but the correction ended almost exactly at the .382 Fibonacci retracement of the five wave up leg. This is added evidence that the correction is complete. Further support for this deduction comes from the extreme bearishness of individual investors and the strong bullish divergences shown by the advancing issues oscillators at the July 2 low point.

So I think that Elliott's wave theory offers more evidence that new highs for the move up from the March 2009 low lie ahead. The remarkable thing about this analysis is that, despite its simplicity, it is not the view of most of the Elliott wave blogs (exceptions: Caldaro and PUG). The Elliott wavers are bearish, almost to a man. This illustrates how easy it is to fit Elliott's theory to one's own market biases.

Update

Here is a daily chart of the September e-minis. The market is rapidly approaching the down sloping trend line (green oval) as well as the point at which its advance from the 1003 low would equal the advance from the May 25 low at 1032 (blue rectangles). I think the market is about to drop 20-25 points. After that the e-minis should rally to the vicinity of the last top at 1129. From there I think a bigger drop, perhaps 30-40 points will develop. Once it is complete I expect the market to resume its advance to new highs for the bull market.

Guesstimates on July 13, 2010

September S&P E-mini Futures: Today's range estimate is 1075-1092. A new upward leg in the bull market started from the 1003 low. Initial target is 1100 or so

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Monday, July 12, 2010

Small Investors Flee Stocks

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on July 12, 2010

September S&P E-mini Futures: Today's range estimate is 1065-1080. A new upward leg in the bull market has started from the 1003 low. Initial target is 1100 or so

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Friday, July 09, 2010

Guesstimates on July 9, 2010

September S&P E-mini Futures: Today's range estimate is again 1055-1075. A new upward leg in the bull market has started from the 1003 low. Initial target is 1100 or so

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Thursday, July 08, 2010

Out at 1058.50 - ES now headed for 1050

Long one unit at 1058.25

Guesstimates on July 8, 2010

September S&P E-mini Futures: Today's range estimate is 1055-1075. A new upward leg in the bull market has started from the 1003 low. Initial target is 1100 or so

QQQ: A new upward leg in the bull market has started. Initial target is 47.50.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Wednesday, July 07, 2010

First leg up


Here is a five point box, one box reversal chart of 24 hour e-mini trading going back to mid-May.

As you can see the market established an extensive sideways range during the past week right at the bottom of a trend channel. A count across this range projects to 1095. A rally as big as the last rally (97 points) would carry the market to 1100 (blue rectangles). This 1095-1100 target area (green oval) will probably be at the upper channel line by the time it is reached.

I think the market has embarked on the first rally in a new bull market up leg. The previous one lasted 13 months and carried 550 points. A rally that carries upward 8 months and 340 points from the recent low would end in April of 2011 at the 1340 level. Another 13 month, 550 point rally would end in August 2011 at the 1550 level.

Update

I was anticipating weakness early in today's pit session but instead the market has rallied from the open. This is strong action and makes me believe that the low of the regular trading session has been established at 1024.75. I still think today's range will be 20-25 points so I am now anticipating a high in the 1045-50 zone.

Guesstimates on July 7, 2010

September S&P E-mini Futures: Today's range estimate is 1010-1035. I think this market is scraping bottom and the worst I see on the downside is 990. Strength above 1050 would mean the low has been established and that a new up leg in the bull market has started.

QQQ: Support is at 42.00. The next move up will carry to 54.00.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. But any weakness below 1150 will mean that a drop to 875 has begun.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Tuesday, July 06, 2010

NYT highlights the bears

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on July 6, 2010

September S&P E-mini Futures: Today's range estimate is 1015-1035. The ES dropped to 1003 last night. I think this market is scraping bottom and the worst I see on the downside is 990. Strength above 1050 would mean the low has been established and that a new up leg in the bull market has started.

QQQ: Support is at 42.00. The next move up will carry to 54.00.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. I still expect to see 875 before 1400. Support stands in the 1160-70 range.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.

Friday, July 02, 2010

Update


Here is a point and figure chart covering the same period of trading in the September e-minis as the bar chart I discussed yesterday. This chart is a five point box, one box reversal chart of 24 hour activity in the e-mini.

One reason I like point and figure charts is that they can offer subtle clues about shifts in the balance of power between buyers and sellers. Generally speaking, sellers are in control when the chart shows more extensive sideways areas at the top of rallies than it does at the bottom of breaks. Buyers are in control when the sideways trading areas at the bottom of breaks are wider that those at the tops of rallies.

On this chart I have used red dash ovals to highlight the trading areas that developed while the sellers controlled the market. There was little sideways movement at lows but quite a bit of it at highs. But in June the situation has gradually changed. The market started to show more extensive trading areas near lows than near highs (green dash ovals).

In particular the trading range that has developed yesterday and today is growing by the hour and is already almost as big as the one that developed near the June 8 low and will soon be bigger than the one near the June 21 top. Moreover it is developing right at the lower trend channel line defined by the flash crash low and the May 25 low.

This is one more piece of evidence that buyers are assuming control of this market and that an extensive rally lies dead ahead.

Guesstimates on July 2, 2010

September S&P E-mini Futures: Today's range estimate is 1010-1030. The odds are better than even that yesterday's low at 1006 ended the drop from 1216. Even if it didn't the worst I see on the downside is 990. Strength above 1050 would mean the low has been established and that a new up leg in the bull market has started.

QQQ: Support is at 42.00. The next move up will carry to 54.00.

TYX (thirty year bond yield): Long term support is at 3.85%. The bonds will soon begin a move to 5.40%.

TNX (ten year note yield): Long term support is at 2.90%. I think that the notes will soon begin a swing up to 4.50%.

Euro-US Dollar: A move into the 135-40 zone is underway.

Dollar-Yen: A rally to 100.00 is underway. Support is at 87.00.

August Crude: I still think crude oil is headed for 50.00.

GLD – August Gold: The odds are that the market will continue upward to 1320. I still expect to see 875 before 1400. Support stands in the 1160-70 range.

SLV - July Silver: I think silver will rally to 21.50 and then begin a move to 10.oo.

Google: The 430 level is now support. A move that should take GOOG above 700 will begin soon.

Apple: Should reach 350 (at least) before the bull market ends. Support is at 240.