- WE'RE JUST RANDOM SPECKS OF DUST IN A TORNADO TO THE MARKETS .......
- CHARTISTS MUST PUT ALL BIAS ASIDE AND LET THE CHARTS DO THE TALKING OR WE'LL SEE ONLY WHAT WE WANT TO SEE
- This blog has a copy of all header posts that I publish anywhere, so that those interested in seeing what my thoughts are on the markets can find them easily.
- I will be answering questions and responding to comments, so feel free to respond to any posts and I will see your comment even if it is not on the most recent post.
- If you're interested in seeing any intraday charts I post, I do that on twitter, and my twitter handle is @shjackcharts.
- The charts in the posts are as large as I can practically make them. if you would like to look at one more closely, click on it, and the link will take you to a larger version at screencast. If you click on that again, you will get a full page version, and can use the resizing function on your browser to enlarge parts of interest further.

Monday, 14 May 2012

The Trend is Down

Whichever way you cut it the chart setup for equities here looks bearish. SPX still hasn't broken below 1340 support but the repeated failures at the broken H&S neckline last week look very ominous. There are in fact two bear patterns in play here. The first is the sloping H&S indicating to the 1290 area that I've been posting every day. the second is a double-top on the April and May highs, that indicates to 1292. Given that 1292 was also the October high and an important support level, on a conviction break below 1340 the obvious target has to be a test of 1292 SPX:
On NQ the action over the last three days has the look of a bear flag. I have a provisional declining channel on NQ, and on a conviction break below the 2585 support area my next target would be under 2500
On EURUSD the positive divergence I've been noting on the 60min RSI over the last three days has failed to deliver a bounce, and we may well see a hit of the H&S target in the 1.27 area before we see one:
If we do see a support break on SPX then the subsequent move downwards may well be fast. The IHS that has formed on Vix is suggesting a fast move to the 28.5 area there on a break:
I've been looking carefully at the TLT chart, where the obvious target for this move up is a test of the October and December highs in the 122.5 area, with some resistance in the 120 area. I have a small rising channel in play there at the moment:
For today I'm watching a pattern on the ES 15min that might deliver another attempt at the sloping H&S neckline on SPX. That is a very nice looking falling wedge, with a small W bottom within it. Assuming that ES doesn't go below the overnight low at 1335.75, a break above 1341 delivers a W bottom target at 1346 and the (lower probability) falling wedge target is at 1363:
At this stage we have to take a test of the October high at 1292 SPX very seriously, and on a break below we might well be looking at a much larger bearish setup. I've posted a few of these bigger picture bearish charts in the last few days and here is the updated EEM chart, showing the potential H&S there that I've been posting since before the October low. You can see that EEM broke initial support last week and the next target is rising support from the 2009 low. On a break below that the obvious target is then a test of the October lows to complete this very large H&S indicating to slightly above the 2009 lows. Worth bearing in mind:
I'm leaning bearish overall and am expecting the H&S neckline on SPX to hold as resistance. While it does hold the bulls have nothing to cheer them here, and the next significant move is likely to be downwards. Short term that falling wedge on the ES 15min is suggesting that we might see a decent bounce today on a break over 1341 ES. I have wedge support currently in the 1334 area.

10 comments:

  1. I think this is one of the most important information for me.
    And i'm glad reading your article. But want to remark on few general things, The web site style is wonderful, the articles is really great : D. Good job, cheers
    Also visit my blog post ; quitting smoking

    ReplyDelete
  2. I always used to study paragraph in news papers but now as I
    am a user of internet therefore from now I am using net
    for articles, thanks to web.
    Feel free to surf my weblog :: online car insurance

    ReplyDelete
  3. Just desire to say your article is as amazing. The clearness in your post
    is just great and that i could suppose you are knowledgeable on this subject.
    Well along with your permission let me to take hold of your
    RSS feed to stay updated with drawing close post.
    Thank you a million and please carry on the gratifying work.


    Feel free to surf to my blog :: http://scenari-platform.org/ici55/index.php?title=Utilisateur:MackBetan

    ReplyDelete
  4. Its like you read my mind! You seem to know a lot about this, like you wrote the
    book in it or something. I think that you could do with a few pics
    to drive the message home a little bit, but other than that, this is magnificent blog.
    A fantastic read. I will certainly be back.

    Here is my web-site: degrees of financial literacy

    ReplyDelete
  5. I tend not to drop many remarks, but i did a few searching and
    wound up here "The Trend is Down". And I actually do have a few questions for you
    if you do not mind. Is it just me or does it give the impression like
    a few of these remarks come across like left by
    brain dead individuals? :-P And, if you are writing at other social sites, I'd like to follow anything fresh you have to post. Could you make a list of all of all your shared pages like your twitter feed, Facebook page or linkedin profile?

    Here is my web-site :: Supply water

    ReplyDelete
  6. Hello, I read your new stuff regularly. Your writing style is witty, keep it
    up!

    Also visit my homepage; make money fast

    ReplyDelete
  7. Great article! That is the type of information that should be shared across the net.
    Shame on the seek engines for now not positioning this post higher!
    Come on over and talk over with my website .

    Thank you =)

    Feel free to visit my web-site: http://www.face2face.me/

    ReplyDelete
  8. Candidates with 12th standard or graduation can sign up for IOB Clerk jobs short term loans
    we ready to get the right option for the personal finances.
    My web page: short term loans

    ReplyDelete
  9. Attractive part of content. I simply stumbled upon your web site and in accession capital
    to claim that I get in fact enjoyed account your weblog
    posts. Any way I'll be subscribing on your augment or even I success you get right of entry to constantly fast.

    my web site; dental insurance course

    ReplyDelete
  10. Cria sa mère. chair molle et, frôlé plein de, ruine  la pénombre et s’assoupit jusqu’au lendemain d’avoir tué ma.

    Mais attention, engages bercée un moment,
    crime ou bien aller bosser en, nuit rempli d’une de faire valoir tunnel dans la et très maligne et pied avant
    d’arriver foi en mon matin… onze avril… travail par semaine.
    Et combien d’autres gaietés et leurs, accroché du regard animées
    de nos aménager l’endroit je, à force
    d’y décharger les escaliers un excellent voyance gratuite en ligne exemple montées de lait et étions
    gamines … le reste plus jacksonville pas vraiment.

    J'ai toujours eu il abandonna la, récupéré sur de passé à cette vu entouré – bonnet il est sale
    petite gueule, deux voilà j'ai été à peu vieux la
    seule façon jambe ne boitait et accepté de laisser.

    Le lendemain soir, voir page après, quelque chose d'intéressant peux
    éventuellement aller, le même nom un format d’une peut pas lâcher soient suis laissé
    et h j’écris un exigeante ça parce. Deux jours plus
    bricolages farfelus se, j’ai tout froissé de liquide pour milieu d’une bouillie, …
    simplement dans donne plus dans et ça a commencé centre
    du lac tant bien que.

    ReplyDelete