[Inspired]

Elliot Wave 5 wave pattern of the SPX

[Vanity]

Originally Posted by mact3333

Timestamp!...I like that...long time no see Vanity.

We are very close to ST/IT top...should see drop, then rise to get all the momo players back in and make slight new high, then a significant pullback...timing is about right...I too see a drop near 1500(maybe abit lower) within next 2-4 months...but then we make new all time highs yet again...odds favor it will be next spring...but modest chance it could happen this fall...depends on how the crazy late coming bulls behave over the next 3-4 months....when mom and pop enter, its the first sign we are near a substantial top...bear will be vicious next year.

The "bear" news will be some made up story serving as the impetus, but the charts are already showing the bear coming...the news will be an excuse...N Korea gonna make some fake noise?......A scuffle with Iran?......Europe going to claim a recession?...but in the end, it will be Bernanke telling us we can no longer have the free crack(i.e.-buying up worthless mortgage backed securities at full price and ending QE officially)...bank on it!

Now time stamp this! I called for new all time highs a year and a half ago when many were semi-bearish...I am calling for a real bear(later) now when people getting semi-euphoric...the top always comes when you see Dow/SPX related stories on how the stock mkt is a sure thing rah rah rah, esp. in media such as USA Today...thats when you will know...watch for it late this year to early next yr...the sheeple will cause an overthrow on the charts before the collapse...but for now, its all clear......I will be calling the DEFCON alerts later.

You guys will be thanking me later haha...unless you are ungrateful ingrates...

One of the best calls ever made anywhere. Hope you ended up making some serious cash on that one ! And it's good to be back! Hopefully I will get the chance to post in here more often.

Originally Posted by mmahany

It's fun to make guesses, but what is your reasoning behind that bold statement?

I'm expecting a short term pullback, but there's absolutely nothing to suggest anything greater than a 4-5% re-adjustment.

It sounds like most of you are basing your hypotheses entirely off technical analysis.

I don't base my macro calls on technicals. I've stated in the past that my most successful trades (i.e, my most successful trade at the start of the New Year which brought in +70% in 3 weeks) are based on pure fundamentals. What are these fundamentals you ask? Look at Options pricing. Follow the money. The smart money.

Back in March we had a large buyer of $SPX long calls when SPX stood at 1550. 85,000 contracts were bought-up by one-single-buyer. The entire trade was worth billions. Right when talks came in around that time of a pullback, a correction, a crash, etc, we had a large buyer step-up to make a long call on the market. Very rare in size since the bulls in this market tend to sell puts to "be long", actually buying 85,000 call contracts meant the SPX actually had to "go up" to make money. Ergo, bam, we went up.

Well now, Options pricing for SPX Skew is looking ugly. Skew climbed 10%+ in 5 sessions. Just trading within the mindset frame of this bull-market since 08', 100% of the time this Options skew has led to a drop of 6-19%. Right now, it's pricing in a -13% drop, but I like to wrap that within 10-15%. Obviously this is not a "guarantee" the market will fall. But certainly it's not a buy-signal for all the bulls who've been in the game since 2008.

Originally Posted by Inspired

I will say it will end up in the mid to high 1400 and the dow at the mid 13000 to high 13000.

Sounds like we're on the same page. What's your hypothesis?


P.S. For the ST I still think we go higher. VIX term structures are too expensive, $VIX range-bound between 12-13% as it's fair price atm. Front-month futures will come out. Perhaps by Mid-June we should see the beginnings of some Macro-instability "headlines" come up.Top is forming itself atm, possibly. Won't comment on a Top until I see a lower-high. Rarely do we ever sell-off without having a dip followed by a lower-high.For now, dance till the music stops.

[nittany]

Originally Posted by nittany

Held onto since 09?!? Wow...very good investor, must be nice to have those nice gains. I'm hoping it break to $60 soon, with Macau going nuts, the new high speed railway, all the upgrades from everyone and rumors of REIT, I think it's very possible. If REIT happens, we hit jackpot, it's going to $80+. Love the volume these days too.

Last month only with the $2.75 per share dividend along with the normal .25 per share dividend was a nice Christmas bonus for us!

LVS

[nittany]

good thing i got out of lvs in the morning. cmon pullback!

[mact3333]

surprise surprise we went down...warning late last week ST top forming...dumped 90% of longs late last week...just temporary though...charts show a ST top and Bernanke fills his dunce role right on cue today.

The big one will be late this year or early next year when he officially ends QE3 but by then, I am sure Goldman Sachs will be fully short the market....then the real fun starts....

I predicted the crash in late 07'...called that real estate bubble in 05' and MBS/CDS meltdown too in early 08'.

Think about this, you see how the tip jar is kinda full when you go into Starbucks right now(take a close look ok), I will bet by next fall it will only have change in it and there will be no dollar bills like you are seeing right now....

We are seeing a massive megaphone pattern over the past 15 years and we will get that overthrow into super bullish territory before the next big selloff...not sure if it will be full on crash or just a major bear, stay tuned.

[Dr. G]

Originally Posted by nittany

good thing i got out of lvs in the morning. cmon pullback!

Nooo, I'm still in haha

MIDD is up approx 27% since my last post though

I didn't get a chance to read the thread, but did anyone have a good month with DDD?

[mmahany]

Originally Posted by Vanity

I don't base my macro calls on technicals. I've stated in the past that my most successful trades (i.e, my most successful trade at the start of the New Year which brought in +70% in 3 weeks) are based on pure fundamentals. What are these fundamentals you ask? Look at Options pricing. Follow the money. The smart money.

Back in March we had a large buyer of $SPX long calls when SPX stood at 1550. 85,000 contracts were bought-up by one-single-buyer. The entire trade was worth billions. Right when talks came in around that time of a pullback, a correction, a crash, etc, we had a large buyer step-up to make a long call on the market. Very rare in size since the bulls in this market tend to sell puts to "be long", actually buying 85,000 call contracts meant the SPX actually had to "go up" to make money. Ergo, bam, we went up.

Well now, Options pricing for SPX Skew is looking ugly. Skew climbed 10%+ in 5 sessions. Just trading within the mindset frame of this bull-market since 08', 100% of the time this Options skew has led to a drop of 6-19%. Right now, it's pricing in a -13% drop, but I like to wrap that within 10-15%. Obviously this is not a "guarantee" the market will fall. But certainly it's not a buy-signal for all the bulls who've been in the game since 2008.

I do realize that this thread is supposed to be specifically about “technical analysis,” but new investors reading this need to understand that technical analysis is generally used for short term positions in equities. If you plan to hold your position for the long term (at least a year), fundamental analysis and the Peter Lynch method of investing will ultimately prevail.

While I agree with your statement of “following the smart money,” my definition of “smart money” may be different from yours. The majority of mutual fund managers are simply trying to match their benchmarks. When you account for fees/expenses, the majority of fund managers are LOSING to their benchmarks. They’re “Closet Indexers.” They claim to be active managers, but most have a very heavy “passive position” and a very small “active position.” Most aren’t taking any wild chances and as a result end up matching the S&P before fees and falling short after fees/expenses. I honestly believe that anyone with a basic amount of knowledge could run a top 50% mutual fund.

My reasoning: look at all the huge Large-Cap Growth Mutual Funds. They’re pretty much all doing the same things: Grossly over-weighted in Apple. Over-weighted in Amazon, Google, and VISA, under-weighted in Exxon and Microsoft.

The only group of fund managers beating their benchmarks is the active stock pickers. Even in those cases, they’re only beating their benchmarks on average by a couple percentage points.

Conclusion- If your version of “smart money” is following the big players then theoretically you should be heavily invested in long Apple and Google positions and heavily invested in short positions in Exxon and Microsoft.

I get what you’re saying and you’re obviously very knowledgeable on the subject, but I constantly question the idea of following others (even the most successful investors). I don’t believe in investing based on tracking high volume trades.

It's very easy to make money in a market like this. People are buying off emotion and everything is appreciating. However, I'm curious to know how many of you did in 2011 when the market was stagnant.

[mact3333]

Nobody should blindly follow any trade ideas from this thread...this thread is to throw out some ideas but everyone needs to do their own dd...only use ideas from this MB if it jives with your own thinking...nobody will take away your gains but they also wont cover your losses...its really up to you.

I do find it funny when some say you have to trade using fundamental analysis over the long run...where are the fundamentals when we enter a bear when every stock in every sector craters?...did their fundamentals all of a sudden implode all at the same time.

What keeps the stock mkt working over the long run is the continual expansion of the money supply creating inflation...without this, the mkts would crash severely....they keep interest rates low and inflation high so you are forced to seek out the equity mkts....The Fed's buy up the worthless MBS's at face value and guess who is paying the bill on that one? Certainly not the Fed Reserve, its us!. We pay through inflation.

But one prob is this, real inflation such as food, gas and rent(things the govt conveniently removes to calculate their official inflation rate) keeps going up but our wages go up at a much slower pace if at all...hence mom and pop both have to work to stay middle class now vs 50 years ago when only pop had to work...kinda started when they stopped backing the dollar with hard assets like gold during early 1970's.

Fundamentals work well during bull mkts when we are throwing darts at a board but you could just buy the momo stocks and probably do better as long as we are in a bull....so the key is to figure out when we enter intermediate and longterm bull or bear mkts...the critical inflection points are what we are after and seek!

This thread is abit odd now cause it started out as a technical analysis thread but it has morphed into something different now...I think part of it is due to the fact it takes alot of effort and time to post charts.

So lastly, I really hope nobody on here trades blindly following others who are perceived to be good/great traders...we are all the same here cause nobody is smarter than the mkts...the mkts can be manipulated by controlling the futures mkt overnight and this is something we must always contend with.

Money expansion--BULL
Money contraction--BEAR

Hope that was clear enough for everyone.....

[mact3333]

Nikkei down almost 6%....

[R Grubba Balls]

^ nikkei closes down over 7% (and saved by the bell)... it's happening. get out now!

for a minute i thought i got out too early. not that i want to see a crash (was thinking about shorting the indexes but i didn't), but feeling good about my sell-all trade.

[Inspired]

TOAST...

[R Grubba Balls]

Originally Posted by Inspired

TOAST...

what software is that? (etrade here, pretty much just eyeballing everything from watching cnbc)

[Inspired]

TC2000