I Caught the Knife, Now I Just Keep Stabbing

  Sort of changing the count from when I took a stab at it a few days ago.  The pivots stayed the same, the labels just rotated.  Speaking of rotation, I wouldn't worry too much if your horse takes a hit, or has taken a hit.  The fear seems to have left the building.  For this count to remain valid, that i level at 1296.5 can't be violated.  I'd look for 1300 to hold.  There is horizontal resistance at 1300, and it's a round number that's sure to bring out some buyers. 
  In all honesty, I'm not sure what levels to expect for this fifth wave, I'm sure someone else would be willing to throw out a number, but I don't see the point.  I feel like it will show itself as we get closer, so there's no point sticking my neck out.  Another thing to consider, which I hope people understand, is that I don't label in the traditional way that Daneric and EWI label.  I still recognize degrees and they are extremely important, I just choose not to because my charts are usually short-term and there is no need to worry about correct degrees.  I'm more concerned with readability than conforming to the degree structure.  So for instance, in the chart above, when yellow 5 ends, some may think I imply that's the end of the fifth wave, but my view is actually that yellow 5 would be 1 of minor 5.  I guess I could obsess over the degrees and have them all look so pretty, but what would be the fun in that?
  We've been moving in 20's on the futures, so if 1300 holds, 1320 is the next spot to look for resistance.

Kwestion of the Week

Where did the Libyan rebels get all this hardware?  They're running around with 50 caliber heavy machine guns mounted to trucks, RPG's in trunks, AK's AK's AK's, and what is this?  Is that a mounted anti-aircraft gun?  What the hell?  Nobody seems to think anything of it either.  I guess some of them are defected military, but they've got an arsenal the NRA would be jealous of.  I guess this was building over time and the people made preparations to bring in weapons, but it's not like they have a weapon superstore down the street where they can pick these things up.  Somebody supplied this war is the obvious answer. 

The market?  It's going up, duh!  Remember... winning?

It's Still Rock N' Roll To Me

All the short term downward trend-lines are broken, and the upward trend-lines are accelerating.  Until we see a change of character, prices will continue to advance.  I think we're starting to see the more dogmatic of the bears covering.  Imagine going short near the 1250 lows and then imagine what you would be thinking holding rotting puts.  The bulls continue to herd the masses into equities.  Look at NFLX and friends... the energizer bunnies have got gas.  You can't afford to fight the tape here with the prospect of a fifth wave.  Possibly a trend ending fifth wave, so a blow off move is not out of the kwestion.  Maybe holding a few unleveraged shorts pay off in a few years, but let's push it to the limit.

Make Me Breakout

Taking A Stab

Everything's up in the air, but this is kind of what I'm looking at.  The other indexes look a little different, but if this really is a fifth wave from the July lows, then it should be fairly large and the wave structure really shouldn't be clear at this point.  We'll see what happens going forward.

Caution is Warranted

The bounce off the lows is looking reticent at the moment.  The many red daily bars are what worries me the most, but prices are advancing despite the intra-day selling.  This character could indicate a correction within a down trend, or it could be characteristic of a fifth wave.  We should be cautious as we finish out the week.  If the bears will make a move, they will do it from these levels.  I'm pretty comfortable saying the action today and yesterday is corrective.  We seem to be in a pattern of holding levels and then taking the ramp overnight.  I'm not going to recommend action at this time, other than to pay attention and prepare stops.

I think this caution is what we're seeing in the market.  Maybe a case of the tail wagging the dog.  If we can break 1300 and hold, I think you'll see a lot of scared money coming in and shorts covering.  That same logic goes the other way though, if we break down and break the 1250 lows we would likely see long-term bullish positions being liquidated.

The Weekend is Coming! The Weekend is Coming!

Have a good weekend guys!

shorts cover

Talk is Cheap

"We're Goin To War Boys!"

When the gates open up in the morning and you're staring death in the face, the machine guns are blasting over your head, they're telling you the world is ending today when japan melts into the center of the earth causing a black hole to swing out of equilibrium, remember the words of our great president FDR, "There is nothing to fear but fear itself."

Say it with me, "I AM NOT AFRAID!"

They're making plans now for the assault...

Japan might end up being a great buy out of this mess. Obviously the damages in Japan equate to a reduction in the value of the underlying companies, but the stock action will likely overshoot to the downside, after which they will sharply recover in a similar fashion to what happened with US markets during the flash crash.

There's no reason these levels can't hold and rally on into these fifth wave mega retard highs.  Not saying they make sense or will persist, but it's not chasing if you win.  The chasers just got creamed last month, and if it turns they'll probably be buyers at 1300.

So we're buying... what to buy?  I don't usually bump a stock, but I have to go with the home town hero, Synovus, ticker SNV.  It has been sitting on its 200 day moving average for a little while, off the bottom of the daily bands.  There is a strong resistance band from $2.36-$2.5, and I would be a buyer within that range on the day, assuming we don't plummet through 1250 /ES.  I see the stock at $3.00 by the end of next month assuming that this rally takes place.  This is a trade that could turn into an investment, but I would just cash it out and move along.  We can always come back.

Don't mistake my bias for being blind to the bearish count.  I made a point to highlight a possible contracting wave from the lows last year, but it was my belief then, and (hanging by a thread) I still believe we can hold these levels.  Should we collapse, OK, I was holding short, and I'd look to 1180-1220 to hold... but we've got to detach from the media barrage and look for value.  Japan got nuked in WWII, and they came back from that... we've seen meltdowns before, and though they are not pretty, they are manageable.  This will take time for all parties involved, especially the Japanese people, but from the fire of the crucible will emerge the strongest elements.  All my prayers go out to the people of Japan, this is a terrible ordeal that I would wish on no one.