Defense Index and GOOG an amazing correlation ….things that make you go hmmmm….?
Posted on December 8, 2013 Leave a Comment
perhaps you are aware, perhaps you are not … I spent 11 glorious years in the United States Navy flying F-14 Tomcats off the pointy end of an aircraft carrier. It was a great ride …because of that, I still consult from time to time for the Defense, Aerospace and IC sectors …keeping an eye on the Defense Industry is a passion and a something that I love to do ….
I say this because the patterns are an objective way to look at the market. even w/ all of the doom and gloom about sequestration, budget cuts, troop draw downs the defense sector has steadily gone UP. even the past couple years … I’ll be honest and tell you that, believe it or not, a lot of these companies have amazing diversity and do IT, CYBER, Health Care, high tech solutions, etc. Your Boeing, Lockheed, etc are AMAZING companies that have their fingers in EVERYTHING.
That being said … the SELL PATTERN is appearing. Objectively, the Defense Index is coming close to a major sell pattern. As I was doing work on this sector I was called away to cook some awesome steaks (thanks to my room mate who taught me how to absolutely nail cooking them …) when I came back to the charts I THOUGHT I WAS CHARTING GOOGLE. I was confused because I have a lot of work on that chart (GOOG) and there was NO WORK on the chart I was looking at…so, I overlaid GOOG on top of the DEFENSE INDEX and just sat back and said … I have to post this. Draw your own conclusion ….
Defense Index … SELL PATTERN complete or just a tad bit higher
GOOG and the DEFENSE INDEX … look the same, hugh? things that make you go hmmmm
amazing indexes … a tour of the masses
Posted on December 8, 2013 Leave a Comment
28 degrees, snowing, freezing rain and tons of kids running around … I’m not getting old, I’m just getting smarter. I wasn’t interested in going outside in this chaos today in NOVA. However, it was a great time to cruise the charts …it was a fun journey, to say the least.
our first chart is a chart of the NYSE Index …2000+ stocks, unable to be manipulated by the futures market and a mix of international players … it’s a GREAT look at the market. why is this such a great chart? Well, there is an index that tracks the total volume traded on the index and it’s down right scary. I did some research to make sure what I was seeing was correct … there “ain’t no buyers folks”
where is the volume?
so then I said “what is the general public doing?” what are the indexes that can convey/show the mood of the masses? pretty cool trip into these charts … the bottom line is they ARE ALL SHOWING SELL PATTERNS. Shoes, Restaurants, Brokers, Gambling, Hotels, Consumer Electronics…etc etc etc. So, as a pattern recognition trader that means 1 of 2 things … 1) the PATTERNS work or 2) they don’t. If the WORK we have TOPPED if they DO NOT WORK we haven’t … easy, hugh?
is it TIME for the EURO turn …. ?
Posted on December 6, 2013 Leave a Comment
one of my mentors, Mike Jenkins, taught me to look for “turns” or “patterns” every 656/710 hours. against the backdrop of the fixed stars that is the time, in hours, that it takes for the moon to make a full revolution. the 710 hours is elongated because the earth is also moving … I’m not asking for anyone to go hog wild and crazy but if the tides, menstrual cycles, animal cycles and a host of “other” things are governed by this object in the sky why not the market? just simply looking for an edge people …
so, if we take NOW and go back 656/710 hours we get: 11/6/2013 11:31:20 PM (710) and 11/9/2013 :31:20 AM (656) those areas are marked w/ orange vertical lines on the chart below. now, I like that, basically, this counter trend move (or so I THINK) has, essentially completed a cycle. and, I also like that the blue arrow is a measured move extreme that basically appeared right at the beginning of the bounce from 1.3294. also, you’ll see labeled a rare yet plausible “triple 3” correction – WXYXZ corrective move. now, for the most part, a combination is “usually” HORIZONTAL in nature however when we have a zig-zag (as we do in the first corrective move (labeled W) then it can continue to go at a steeper angle … either way, I see this move/advance as corrective.
the other to note is the daily high today is 1.05946*W projected from X. 1.05946 is the ratio used for tuning in the equal octave scale of music …I would like to see a close below 1.36827 on Sunday night/else 1.3717 could be attacked.
EUR vs USD 12/06/2013
is this overall DOLLAR weakness (well kind of) or is the EURO ready to turn against a bunch of pairs? let’s check …
EURJPY attacking .618 from all time high and, a little higher, a major extension target
EURAUD showing 1,2,3,4,5 and .382 retracement
EURGBP a little higher w/ strong resistance at .8420
EURCHF BUY pattern failure
EUROKIWI SELL PATTERN from 12/05/2013
EUROKIWI sell pattern result from 12/05.
so, in summary, I believe a MAJOR turn is at hand for the EURO vs a number of crosses and the timing “appears” right for a potential turn in favor of the buck come Sunday night. TBD and we’ll see ….
NFP and the emini …
Posted on December 6, 2013 1 Comment
at 0830 EST today I’m going to be drinking a cup of coffee, more than likely meditating or playing some kick ass music but the farthest thing from my mind is going to be the NFP. this manipulated number has BILLIONS if not TRILLION of HFT (high frequency trading programs) going crazy on the BID/ASK w/ fraction of milliseconds execution. how can a pattern recognition trader in his home office compete w/ that … not that I can’t, I’m just not …
how about the EURO yesterday? some fundamental announcement about inflation (if you don’t have inflation could you have DEFLATION (?)) and the EURO gets hammered and then, out of no where, the BID comes in (read: our FED) and today wasn’t the day and KABOOM it’s gone higher …FX is a wonderful, 4 trillion dollar/day market. the gorillas are big and they juggle dynamite!
I digressed …here’s what I “see” – note a a very symmetrical 5 wave move down and now the “typical” three wave move up and a PATTERN completing in/around 1800. Upper targets are shown and they could be hit …
bottom line – grab a cup of Joe or
E mini before non farm
Green Tea and just sit on your hands. things will settle down, a pattern will appear and let it rip.
AAPL and GOOG patterns completing …
Posted on December 6, 2013 2 Comments
here was the geometry for the top in AAPL:
https://bartscharts.com/2013/08/20/sir-issac-newton-and-aapl-fell-from-the-tree/
here was the geometry for the low in AAPL:
as we approached the low a very symmetrical 3 drives to a bottom appeared:
the “first” top that appeared gave us a sell signal and about 70 bucks but the market moved up and higher …now, we are completing another pattern along w/ returning to the trend line on AAPL. So, this is a very crucial juncture for the market …
GOOG — how UnAmerican can you get – trying to short GOOG? Well, it’s just numbers and patterns so guess what we are “there” again w/ GOOG so after the near knockout punch of a simple 100 point gap in your face – why not?
here’s the blog of the “next” target:
https://bartscharts.com/2013/10/21/more-pumpkin-soup-added-a-new-ingredient-to-the-recipe-goog/
here’s the update:
Equal Octave Scale of Music and the DJIA …
Posted on December 5, 2013 Leave a Comment
my friend, fellow chartist and trader gave me the chance to do this post on his blog as a “guest blogger”
http://allstarcharts.com/the-math-behind-historic-dow-charts/
at the time, I was watching, extremely closely, the “standard” .618 price projection and it’s importance due to using the all time low from 1896 at 28.48. the market opened/closed in and around this level for roughly 5-6 months an then exploded higher.
one of the lesser know price projection techniques is actually based on the equal octave scale of music. this is NOT going to be a diatribe about musical theory, if your so inclined see a website like this: http://www.phy.mtu.edu/~suits/scales.html . as a trader, I know the musical note ratio’s and I also have some fundamental understanding of the importance of square roots and their inverses and we’ll leave it at that….
so, if we take musical note F# ratio of 1.68179 and then subtract 1 we get .68179. that is the multiple that we project from and that nails the recent high and also intersects the expanding triangle that is bearish. (1.618-1 = .618)
stay tuned and as we’ve been saying for a while, things certainly seem to be adding up ….
DJIA and musical note F# of the equal octave scale of music
Gold since 1913
Posted on December 5, 2013 Leave a Comment
historical data is king … w/ the correct and long term data we can make some very powerful forecasts and look for patterns that others might not see. I came across a chart the other day that showed the price of Gold in/around 20 bucks when the FED was created in 1913. so, below I plotted the PRICE action that took us up the low of 252 in 2001. I wasn’t surprised that the recent low in Gold was a .382 from 20 bucks …NOW we can understand why this is an important level. In any liquid instrument that has been on an extended BULL or BEAR run the .382 correction is “usually” a good stopping point and a place to asses market action. strong and powerful trends will hit these levels and resume like a rocket ship. weak trends or shifts from bull to bear or vice versa will, usually, respect the area, but then will give away and continue lower.
I really don’t have an opinion on the gold bounce … I do have an opinion on the wave count and that tells me lower, for now. when doing pattern work for this key commodity, make sure to use the 20.67 level. that node will prove to be important again.
SPOT GOLD since 1913
Dow Jones Transportation Average – a chart tour starting in 1896
Posted on December 1, 2013 Leave a Comment
if you have been following the posts over the past couple months, you’ll find that I’ve moved (pretty much alone) into a very cautious, if not outright bearish mindset based on the patterns that are appearing across the circle of life. one of the more prevalent patterns that I’ve been watching is the DJTA. from the all time low of 49 on 10/29/1896 it has been shown how this key “node” was the anchor behind support in 1987, 2000 and 2009. Using this node we can now project for targets on the DJTA. anywhere between 7400-7600 on the index should be extremely important resistance if not an a major inflection point. here is the chart (updated as of 11/30/2013)
so, we’ve got just a little bit more to the upside, so I decided to take a peak at the entire DJTA and look for patterns that support a bearish nature once this level is hit. take a view thru the charts, no screaming buys but I do see 1) parabolic rises, 2) monthly sell patterns appearing and 3) some stocks that topped years ago. so, be mindful of this level and, well, we’ll see if the patterns work or not ….
Bart's Charts 