Below is Tony Caldaro's hourly chart of the S&P 500, which you can always see as it updates using Tony's chart link at his site, Elliott Wave Lives On. Tony's comments specifically on his markings on this chart, are "Overnight the SPX futures ran right into the upper trendline of the expanding triangle noted yesterday. The futures then pulled back for the rest of the session. In the cash market the SPX made a new uptrend high at 889 in the morning and pulled back to 869 before bouncing into the close. The market is now leaning to the downside on the very short term charts, but will need a break to around 860 to continue this [downside] momentum."
While Andre Gratian uses different techniques, I suspect that he may see it similarly, and we'll look forward to his public weekly overview this weekend.
Welcome to the month of May! If May 1 is "May Day*" then we'll have to see what that means for the markets - probably not much! So, many hedge funds closed their books for the quarter yesterday. And we can see if the "new month, new money" effect helps any - I have seen data showing that the markets tend to be weak about the 26th of each month, and push up into early the next month on the expectation of investors putting new money "to work". I think there is such an effect but not a guarantee each month.
You can better believe that large institutional investors and funds are looking at macro indicators like the Nasdaq 100 at their 200-day AND their 200-MONTH moving average, along with the P&F chart like I showed yesterday with the QQQQ's at resistance. There are other indicators also of course, and other markets. The Dow Transports did push above their 200-month MA but I'm not sure they're going to make the 3300 level or find resistance at a resistance line sooner. Others like the SPX are not their yet (although my SPX:VXO ratio chart has been dipping as it encounters its 200-day MA).
I can think of two possible chart patterns that take the markets to new all-time highs after the precipitous drop we've seen since October 2007. They are both unlikely, though theoretically possible, and in any event we've got to let the markets prove themselves first. Many have been looking for a pullback and this is definitely a logical place for the pullback to start kicking in.
Danger for the markets is that a pullback slices under 790-ish, but then again there are a few reasons to think that the time window around late May/early June would be a swing high. As always, no particular pattern appears cast in stone. At least we have the numerous indications, posted over the past couple of weeks, that show this area is a logical "line in the sand" for the markets. Anyone remember a chart I posted a couple of weeks ago, with two oval-type "circles" drawn on the SPX chart, and describing these levels as where there's a "bull vs. bear" battle? Well, we are in the upper of those circles now.
If the markets can push above SPX 944 then it will be seen as a very bullish sign, even though there are other pivots and resistance levels above that. But the way the markets can keep the most number of people guessing and perhaps wrong, is by dipping and having us all guess, is it a pullback, or do we re-test the March 6-9 lows, or do we go to new lows? This is as good a reason as any - along with all the indicators - to be with the market if it rolls over from here.
Welcome to the month of May! If May 1 is "May Day*" then we'll have to see what that means for the markets - probably not much! So, many hedge funds closed their books for the quarter yesterday. And we can see if the "new month, new money" effect helps any - I have seen data showing that the markets tend to be weak about the 26th of each month, and push up into early the next month on the expectation of investors putting new money "to work". I think there is such an effect but not a guarantee each month.
You can better believe that large institutional investors and funds are looking at macro indicators like the Nasdaq 100 at their 200-day AND their 200-MONTH moving average, along with the P&F chart like I showed yesterday with the QQQQ's at resistance. There are other indicators also of course, and other markets. The Dow Transports did push above their 200-month MA but I'm not sure they're going to make the 3300 level or find resistance at a resistance line sooner. Others like the SPX are not their yet (although my SPX:VXO ratio chart has been dipping as it encounters its 200-day MA).
I can think of two possible chart patterns that take the markets to new all-time highs after the precipitous drop we've seen since October 2007. They are both unlikely, though theoretically possible, and in any event we've got to let the markets prove themselves first. Many have been looking for a pullback and this is definitely a logical place for the pullback to start kicking in.
Danger for the markets is that a pullback slices under 790-ish, but then again there are a few reasons to think that the time window around late May/early June would be a swing high. As always, no particular pattern appears cast in stone. At least we have the numerous indications, posted over the past couple of weeks, that show this area is a logical "line in the sand" for the markets. Anyone remember a chart I posted a couple of weeks ago, with two oval-type "circles" drawn on the SPX chart, and describing these levels as where there's a "bull vs. bear" battle? Well, we are in the upper of those circles now.
If the markets can push above SPX 944 then it will be seen as a very bullish sign, even though there are other pivots and resistance levels above that. But the way the markets can keep the most number of people guessing and perhaps wrong, is by dipping and having us all guess, is it a pullback, or do we re-test the March 6-9 lows, or do we go to new lows? This is as good a reason as any - along with all the indicators - to be with the market if it rolls over from here.
Here's Tony's hourly chart of the S&P 500:
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*In case "May Day" does have some socionomic influence on the markets, here's a Wikipedia article http://en.wikipedia.org/wiki/May_Day with some information on it - looks like many have used it for political purposes, and many have used it for a long time as part of the welcome to better weather!
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