Guesstimates on June 29, 2012

September S&P E-mini Futures: Today's range estimate is 1342-1357.  I think the drop from 1357 ended at 1302.50 on June 25.  A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after last week's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market is still at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: Crude oil is approaching  what should be strong support near the 75 level.  From there a rally of $15 or so will be likely before the market resumes its long term trend to still lower prices.    

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 and has traded sideways even as the broader averages have dropped during the past few days. This is a sign of strength and I think the market is headed above its 644 top.  

Guesstimates on June 28, 2012

September S&P E-mini Futures: Today's range estimate is 1314-1328.  I think the drop from 1357 ended at 1302.50 on June 25.  A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after last week's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market is still at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: Crude oil is approaching  what should be strong support near the 75 level.  From there a rally of $15 or so will be likely before the market resumes its long term trend to still lower prices.    

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 and has traded sideways even as the broader averages have dropped during the past few days. This is a sign of strength and I think the market is headed above its 644 top.  

headed up

Here is an hourly bar chart of the cash S&P 500. I discussed this chart last week.

The green lettering highlights the head and shoulders base which I think the market formed beginning with its May 21 low point. The neckline (red dash line) formed at 1335 and the market broke out well above that level on a rally which took it to 1365.

Normally the reaction following a breakout above the neckline stops when it encounters support at the neckline. But this time the S&P dropped well below that level. However the break did stop above the low associated with the right shoulder of this head and shoulders base. A drop below the right shoulder would mean that the breakout above the neckline was a so-called "false" move and the implication then would be that the market would drop to the level of the head or even slightly lower.

However it looks to me that support at the right shoulder has held and that the market is headed up once more. I expect this swing to at least reach the standard head and shoulders target which in this case is about the 1405 level (first pair of blue dash rectangles).

A slightly higher target is provided making the 1365 breakout rally high the midpoint of the rally from the low this past Tuesday (second pair of blue dash rectangles). This gives a 1410 target. Finally one can estimate a still higher target by making the 1365 level the midpoint of the move up from the June 4 low. This target does not appear on the chart above but stands at the 1460 level. It is this last target which I think the market will reach over the next couple of months.

Guesstimates on June 27, 2012

September S&P E-mini Futures: Today's range estimate is 1312-1325.  I think this break is nearly over. It is only a correction within a bigger up trend. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after last week's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market is still at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: Crude oil is approaching  what should be strong support near the 75 level.  From there a rally of $15 or so will be likely before the market resumes its long term trend to still lower prices.    

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 and has traded sideways even as the broader averages have dropped during the past few days. This is a sign of strength and I think the market is headed above its 644 top.  

Guesstimates on June 26, 2012

September S&P E-mini Futures: Today's range estimate is 1295-1311.  I think this break is nearly over. It is only a correction within a bigger up trend. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after yesterday's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market is still at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: Crude oil is approaching  what should be strong support near the 75 level.  From there a rally of $15 or so will be likely before the market resumes its long term trend to still lower prices.    

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 and has traded sideways even as the broader averages have dropped during the past few days. This is a sign of strength and I think the market is headed above its 644 top.  

Guesstimates on June 25, 2012

September S&P E-mini Futures: Today's range estimate is 1305-1322.  I think this break will probably continued down to 1300 or so. But it is only a correction within a bigger up trend. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after yesterday's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market is still at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: Crude oil is approaching  what should be strong support near the 75 level.  From there a rally of $15 or so will be likely before the market resumes its long term trend to still lower prices.    

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 and has traded sideways even as the broader averages have dropped during the past few days. This is a sign of strength and I think the market is headed above its 644 top.  

Guesstimates on June 22, 2012

September S&P E-mini Futures: Today's range estimate is 1310-1327.  I think yesterday's break will probably continued down to 1300 or so. But it is only a correction within a bigger up trend. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after yesterday's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is now at 1.2760. EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even after the S&P and the Dow broke below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top. 

Guesstimates on June 21, 2012

September S&P E-mini Futures: Today's range estimate is 1347-1367. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. Yields moved up prior to and after yesterday's Fed news so I conclude the market thinks the Fed's easing actions will have the desired effect. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is now at 1.2760. EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

August  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even while the S&P and the Dow broke below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top. 

breakout

Here is an update version of the hourly chart of the cash S&P 500 I showed you last week.

The S&P has broken out to the upside from a clearly defined, head and shoulders bottom formation. The standard measuring implication is that the market will move as far above the breakout point (green dash line) as the head (labeled with a green H) was below it. This works out to an upside target of 1405 or so (blue dash  rectangles).

In fact I think the market is going to break above its March-April highs by a substantial amount and will visibly exceed the target shown on the chart above. The rally from the June 4 low has developed against a steady drumbeat of despair over the ability of the EU to heal its economic sickness. Market sentiment also has been steadily bearish during the rally which began with a bullish divergence in my advancing issues oscillators.

The ability of the market to rally on bad news was actually emphasized today by its response to the Fed announcement. The Fed said that it was going to extend "operation twist" until the end of the year. In my view this was actually a bearish piece of news for two reasons. First,  operation twist is a purely cosmetic change in the composition of the Fed's balance sheet, not a balance sheet expansion which is what is needed now. Second, the Fed scheduled a tentative December end for the program. This is beyond stupid. It guarantees that the market will discount the end of the program well ahead of time and that any stimulative effect "twist" might have had will thereby be negated. What the Fed should have said was that it would continue operation twist until the economy moved onto a normal growth path of 2-3% real and about 5% nominal GDP growth.

The S&P dropped only 7 points after the Fed announcement, a surprisingly bullish response to what I thought was quite bearish news. It has since rallied to new  highs for the day and is flirting with its rally high. This response to the news shows that the underlying technical condition of the market is very, very strong. By this I mean that longer time frame traders and investors have on average bigger than normal long positions while shorter time frame traders have smaller than normal long positions. Shorter time frame traders are going to have to bid prices up a lot to entice longer time frame traders and investors to sell shares back to them.

The S&P is going much higher over the coming weeks and months.

Guesstimates on June 20, 2012

September S&P E-mini Futures: Today's range estimate is 1350-1367. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If so yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is now at 1.2760. EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even while the S&P and the Dow broke below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top. 

Guesstimates on June 19, ,2012

September S&P E-mini Futures: Today's range estimate is 1337-1353. A move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is at 1.2680. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 18, 2012

September S&P E-mini Futures: Today's range estimate is 1320-1337. The overnight high at 1347.50 on the Greek election  news should be taken out later this week. In any case a move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is at 1.2680. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 15, 2012

September S&P E-mini Futures: Today's range estimate is 1324-1342. Yesterday's strength surprised me and it looks like the start of a breakout move above the June 11 top at 1342. In any case a move to new bull market highs is underway.  

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is at 1.2680. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 14, 2012

September S&P E-mini Futures: Today's range estimate is 1291-1312. It looks like the ES is headed down to 1280 or so. From there a move to new bull market highs should begin.

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is at 1.2680. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

interesting chart patterns

Here is an hourly bar chart of the cash S&P 500 covering the past month of trading.

As you know I think the reaction from the March-April highs ended at the June 4 low. Since the May 21 low point the market has been tracing out a couple of interesting examples of the classical head and shoulders formation.

The bigger and more significant pattern is a head a shoulders bottom. The left shoulder and the head are labeled with green letters. I am not really sure if we have seen the right shoulder yet or not, hence the two green  "S" labels which follow the "H".

Part of the uncertainty arises from the fact that the rally from the June 4 low has stalled and in the process of moving sideways the S&P has traced out a potential head and shoulders top (red lettering). The standard measuring implication of such a formation is that the market will drop as far below low preceding the rally to the right shoulder as the head was above that low. This would imply a drop into the 1280-85 range which I would then interpret as the likely left shoulder of the bigger head and shoulder's bottom formation.

With the Greek elections this weekend and the Fed meeting next week the market will have plenty of excuses to move in both directions so I think we are going to see breakouts from one or both formations over the next week or two.

Guesstimates on June 13, 2012

September S&P E-mini Futures: Today's range estimate is 1311-1331. Should the ES stat spending time below 1310 I will conclude that the market will continue down to 1280 before the swing to new bull market highs resumes.

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. Resistance above the market is at 1.2680. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 12, 2012

September S&P E-mini Futures: Today's range estimate is 1300-20. The  ES is headed for new bull market highs.

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 11, 2012

September S&P E-mini Futures: Today's range estimate is 1322-34. The  ES is headed for new bull market highs.

QQQ:  A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 8, 2012

June S&P E-mini Futures: Today's range estimate is 1309-25. The fast rally to yesterday's high at 1329 had all the earmarks of a lock-out rally following a shakeout below the 1287 low. This means that 1262 ended the correction from 1419.75 and that the  ES is headed for new bull market highs.

QQQ:  It now looks like the correction is over. A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

Guesstimates on June 7, 2012

June S&P E-mini Futures: Today's range estimate is 1317-1333. Yesterday's fast rally started after the market had moved back above its May 21 low at 1287.25. It has all the earmarks of a lock-out rally following a shakeout below that low. This means that 1262 ended the correction from 1419.75 and that the  ES is headed for new bull market highs.

QQQ:  It now looks like the correction is over. A move to new bull market highs is underway.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market has bounced off of 1.2250 support. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - July Silver: A sustained move up is underway.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously. 

headed up

All of the charts you see above can be found on my chart page updating in real time.

The top chart above this post shows the daily cash S&P. As you can see the market dropped to about 1265 Monday, about 20 points lower than what I thought would be strong support at the October 27, 2011 top (green dash line).

Today's rally pushed the S&P back above that support level and this makes the break below 1295 on the employment news look like a shakeout which often precedes a big move in the opposite direction.

The other three charts provide more evidence for this shakeout -then -rally hypothesis. The second chart from the top shows the cumulative daily advance decline line on the New York Stock exchange. Unlike the Dow and the S&P this indicator did not break its May 21 low this past Monday. It also has held well above its rising 200 day moving average, another bullish sign.

The bottom two charts show the 5 day (purple line) and 10 day moving averages of the daily number of advancing issues on the New York Stock Exchange. Notice that the 5 day moving average dipped to a higher low this past Monday, thus diverging bullishly from the action of the S&P and the Dow which put in lower lows. The 10 day moving average has risen steadily from the May 21 low, another bullish divergence.

Given the high levels of bearish sentiment which I pointed out last week these divergences are telling me that the correction from the March-April tops is over. I think a move to new bull market highs has started.

Guesstimates on June 6, 2012

June S&P E-mini Futures: Today's range estimate is 1286-1301. The market has moved back above its May 21 low at 1287.25 and this is a modestly bullish development. It becomes more significant because the advancing issues oscillators showed bullish divergences at the 1262 low. I think it is likely that 1262 ended the drop from 1419.75.

QQQ:  Support is still  at 59.50 but it now looks like the correction is over. A move to new bull market highs should be the next development.

TNX (ten year note yield):  The 10 year yield had dropped below  the low of its recent multi-month trading range. I suspect that QE III is just around the corner. If it is yields will head back up to 3.00% and higher.   

Euro-US Dollar: The market is bouncing off of 1.2250 support. I see no sign that the decline is over. Indeed EU survival will require a much lower euro than we see now. I think the market will eventually drop well below 1.1500.   

Dollar-Yen: This market is headed for 75 and lower.

July  Crude: The market is headed  down to  75.   

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is about to start.  

SLV - July Silver: The market is getting close to its December low at 26.27 where a sustained move up is likely to start.

Google: Google should hold support near 562 and then  resume its move up to 750.

Apple: So far AAPL has held well above its low at 528 (I think the reported 522.16 low was a bad tick!) even as the S&P and the Dow have broken below their corresponding lows. This is a very bullish development. It makes me think the AAPL is now in fact headed above its 644 top instead of to 520 as I had thought previously.