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I posted an update over the weekend (8April) which I hope made it to the
list (see below). As I remember, in my 31March post, I indicated that
1493 was an expected minimum for w.4 and a close below 1432 would
nullify the entire EW structure implying that the structure would be ok
if 1432 held on closing basis . The decline got within a couple of
points of 1432 before rallying sharply which left the EW structure
intact but not without severe damage. As I wrote after the decline,
the effect of the steep decline was to significantly lower the expected
minimum target for w.5 from 1623 area to the price range of the previous
high (1563 to be specific). Normally, I would look to the 60 minute
chart for a clear 5 wave internal structure for the w.5 on the daily,
however I don't see it and we seem to be rolling over from the 1543
high. Since my NYSE models have begun to roll over (although still
healthy) and there is no clear impulse structure, my current thinking is
that we are probably in some type of corrective pattern which would be
broken by a violation of 1503. The sharp decline has done a great deal
of technical damage to the price structure of what appeared to be a new
impulsive structure beginning 29Oct on the weekly ... the rally from the
03March (weekly) low should have been fast and powerful. I think we will
have to wait and see now if SP consolidates and makes another attempt or
takes out the 03March low and heads south indicating that the stock
market does not remain invincible to the old interest rate step and
stumble rule. The index I'm watching now is ND (June) along with my
NASDAQ breadth models. If 3644 holds with a marked improvement in
breadth, things will look better. Next in line is 3191 which should be
the maximum decline for a correction ... anything more and we are likely
in an impulsive decline.
Earl
8April Post:
NYSE model remains on buy but divergences are beginning to appear in 2
of the 3 NYSE breadth models and Friday was a NYSE daily reversal day,
intermediate term NYSE model still in good shape. NASDAQ model managed
to climb into buy territory, however the intermediate term model remains
in poor shape and we did not look to buy NASDAQ. AGet PITI on June SP
has declined to 33 which appears to confirm the 1563 projection I posted
last week indicating that SP is more likely to put in a double top
rather than new highs on this trip up.
As we took money off the S&P table early this week, we nibbled on
Vanguard Intermediate and Long term corporate index and REIT index
funds. Balance of S&P index will be sold on either NYSE sell signal or
rally to 1560 area in June SP.
On trading side, looks like a bit more weakness ahead in commodities but
nothing major. We liquidated long side of hedged May sugar
Thursday/Friday and kept the short side for a pullback and will re-enter
long December if correction doesn't run too deep. Watching W, BP, and JY
for possible longs. Also eyeing possible exhaustion gap in HG - copper
is at critical juncture. A rally through the gap could indicate a
sustained rise ahead and strength in the economy while a new low could
signal recession.
----- Original Message -----
From: <Jpilleafe@xxxxxxx>
To: <eadamy@xxxxxxxxxx>; <realtraders@xxxxxxxxxxxxxxx>
Sent: Tuesday, April 11, 2000 5:14 AM
Subject: Market Outlook.....Question for Earl Adamy
> Hello Earl,...
>
> This is Jim Pilliod. I appreciated your 03-31 detailed "Market
Outlook" post
> so much I printed it out and saved it in my notes. In that post you
had
> described the 1493.50 minimum target for a corrective Wave 4,...etc.
> My question is: Did last week's big drop on Tues 04-04 complete (or
> invalidate)
> the Wave 4 count and would you think that we are in the process of
building
> Wave 5,...etc. In other words,..for the S&P500 how do you see things
here?
>
> My work suggests a pivot here,..today 04-11, as is 17 mkt day count
from
> 03-17, was 17 mkt days from 02-23, which in turn was 17 mkt days from
> 01-04 ...all key pivot dates. I am open minded to a turn to the
upside for
> the
> S&P500 here. Also the Bradley Model too has low 04-10 with up into
04-18.
> The 04-18 to 04-19 timeframe looks to be the next VERY IMPORTANT
> time frame, as indicated by a variety of different methods. So my
bias is
> to look for up into the 04-18 time frame. Just my personal
thoughts,...
> likely wrong,..etc.
>
> If you have time for a brief post, I think it would be appreciated.
> Thanks again for openly sharing you work. And have a good week.
>
> Regards, JIM Pilliod jpilleafe@xxxxxxx
>
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