aarc's  Instablog

Send Message
  • Long Live The Queen 1 comment
    Feb 28, 2012 12:29 PM

    Dow Jones is traditionally the King of Stock Markets. What makes of the broad-based SnP500 = The Queen?

    SnP500 is now knocking at the 1371 Double Top Resistance set last May 2nd, 2011:

    - http://img38.imagefra.me/i52r/aarc/12xv_f80_ubk5c.png

    The daily chart may still have a good chance to break the 1371 Double Top Resistance:

    - img37.imagefra.me/i52r/aarc/12xv_a4d_ubk5c.png

    ** Feb 28 Additional:

    Finding a high-confidence wavecount on the daily and intraday squigles on the major indexes cash markets is extremely hard. However, there are some charts that provide better guidance:

    - img37.imagefra.me/i52s/aarc/12xv_06b_ubk5c.png

    - img37.imagefra.me/i52s/aarc/12xv_d3e_ubk5c.png

    XLF daily chart provides a good read but the 3rd failed to become extended by a hairline or two - hence making a target for the 5th a guessing game.

    The ES 24-hr 240-min chart provided a good read of the most recent A-B-C run. A textbook EW A-B-C that does not happen so often in the real world.

    That makes the following Armageddon Scenario of last year highly unlikely to happen:

    - img40.imagefra.me/i546/aarc/155w_71f_ubk5c.png

    The multi-decade Secular Bull Market Scenario is starting to gain ground:

    - img38.imagefra.me/i5al/aarc/12xv_af2_ubk5c.png

    The case for bears, however, cannot be discounted since there are still several ways the short-term bullish count can turn into a medium-term bearish count (mainly a small A-B-C corrective rally from the Oct 2011 low which should result in a big vertical C-wave meltdown that may or may not break below the Oct 2011 intermediate bottom).

    I sold 1/4 SSO (bought at the Aug/Oct bottoms) and 1/3 FAS Swing Trade positions at 5-8 points below the SnP500 1371 Double Top Resistance in order to insure the sell orders will catch the bid(s).

    Also sold half of AAPL Trend Trade (bought at the $380+ levels near the the $508 1-2-3-4-5 nominal target. Apple, however, is still a 1-2-3 wavecount with the 4th and 5th runs expected to happen before a correction of 10+% could happen. Trading Discipline is always to sell some (if not all) positions at or near target(s). Will keep 20-30% of AAPL positions as possible long-term hold just in case Apple actually goes into a bubble run (doubling or tripling in price almost every year for several years - similar to what MSFT and INTL enjoyed in the 1990's).

    Will keep the MSFT and INTL buys of Aug/Oct 2011 as part of long-term Super-Cycle Rally analysis (both companies already went into 10+/- years of Super-Cycle Correction). The RAX long trade of December got stopped out early in the game with small profits before RAX went into a vertical rally.

    Total positions is now reduced to 115% (90% portfolio + 25% Swing Trade) from the 135% of last. Trading Strategy is to unwind most (if not all) of the Swing Trade at or near the SnP 1420 Nominal Target then possibly raise 10% cash in preparation for a 10+/-% correction. Then make a new Swing Trade with 1594 as the next intermediate target with 1576 as the Major Multi-Decade Resistance.

    ** There is still the problem of SA not saving the web link properly.

    ** A get-around way to make the chart(s) to show is to copy the weblink URL. Start from the right side .png then press (and hold) left mouse button toward the left side img38 then copy the weblink. Then paste the weblink in another browser tab or window.

Back To aarc's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (1)
Track new comments
  • CostBasis
    , contributor
    Comments (12) | Send Message
    To try to fix the SA weblink problem, try using URLs like http://img38... instead of just img38... Hope this helps.
    27 Feb 2012, 07:02 PM Reply Like
Full index of posts »
Latest Followers


More »

Latest Comments

Most Commented
  1. The Hope Trade ( Comments)
  2. Somewhere ... Over The Rainbows ( Comments)
  3. FOMO Trade Redux ( Comments)
  4. The FOMO Trade ( Comments)
  5. Chasing Rainbows ( Comments)
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.