Today is the last day of trading for August, the end of the month, EOM, and the SPX is set for three straight months of gains reflecting the July-August rally. The monthly charts receive new prints today. Chairman Bernanke is on the mountain right now receiving the tablets. He will bring them down from on high and deliver the announcements at 10 AM EST. The first hour of trading should be a circus. Fifteen minutes after the opening bell, the Chicago PMI number is released, followed by Consumer Sentiment at 9:55 AM, then Factory Orders and Bernanke at 10 AM. Keystone tested the seat belt on the computer chair to make sure it is ready to handle the drama expected early in the session. Expect multiple market pivot points up thru 10 AM. Markets should settle in for the day after 11 AM.
Markets tend to be bullish in front of a three-day holiday weekend and the futures reflect this bullishness. Markets also tend to be bullish moving into the full moon, which is this evening, a Blue Moon in fact, two full moons are occurring this month, the full moon tonight deemed the blue moon. It does not occur often, hence the old adage, 'once in a blue moon'. Continuing with the esoteric, a Bradley turn date occurred last Saturday and the window for that potential trend change closes today. The ECB rate decision is next Thursday and Jobs Report next Friday, so Bernanke's words today may dictate market direction into late next week.
If JJC, copper, stays under 43.70, markets will remain weak, and if one of the following parameters, SOX 390, UTIL 464, VIX 18.35 or NYA 7835, also turn bearish, the markets will be selling off strongly and Keystone's algo, Keybot the Quant, will likely flip to the bear side. If JJC moves above 43.70, the bulls plan on floating the markets upwards into the weekend. For the SPX today starting at 1399 support, the bulls need to touch 1410 and an acceleration to 1419 would occur in short order. The bears need to push only two points lower, under 1397, to accelerate the downside to 1391. A move thru 1398-1409 is sideways action today. Pay attention to the SPX 20-day MA at 1406.62, the early futures are likely targeting this level for an early test.
Markets are closed on Monday for the Labor Day holiday. U.S. trading will resume at 9:30 AM EST on Tuesday. Now that the seat belt is ready, Keystone must test and check his helmet in preparation for the early trade today; it may be a busy morning. In a nutshell, JJC 43.70, SOX 390, UTIL 464, VIX 18.35 and NYA 7835, as well as SPX 1410 and 1397, tell you everything you need to know for broad market direction today. Copper and semiconductors are most important.
Great stuff.
ReplyDeleteHave. You ever backcast in the Pratley model? I have and it's results are far from stellar, no pun intended :-)
Hello Anon, interesting, but nope, the backcasting typically picks the outcome and works backwards so its a bit different than Keystone's forecasting which attempts to forecast the outcome forward. Key dates, economic releases, news events, etc..., can all be correlated to the charts, then chart fractals can be used to see if they ryhme with the real-time market moves. For the Bradley model, type 'Bradley' into the search box above which will bring up a recent chart showing the Bradley turn dates and what happened to the broad markets, it is amazing how the dates nail the market inflection points most of the time. As always, in trading, we do not care how something works, only that it works and is repeatable, if so, then it is worth following.
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