The Road Ahead

I’ve taken advantage of a relatively quiet morning in the markets to finish mapping the road ahead.  There are quite a few harmonic patterns in play right now.  My practice is to map all the apparent possibilities and look for confirmation (or lack thereof)  between patterns — and then look for ways in which they agree or not with all the chart patterns, channels and analogs I’m watching.

It’s fairly exhaustive, so takes a fair amount of time.  I hope to post the results in the next hour or two.   In the meantime, the short-term forecast is still for increasing prices.  This morning’s chop does nothing to change that, but does illustrate the importance of using stops.

Like yesterday, l will occasionally post short-term trading opportunities.  For traders so inclined, the idea of shorting at 1328 and buying back at 1298 is a great trade.  But, it requires a certain degree of vigilance.  For the buy and hold crowd who aren’t interested in 30 point blips, feel free to ignore such forecasts.

Whichever camp you fall into, please remember to use stops at all times.  These are very precarious times, where unforeseeable events capable of moving markets are unfolding daily.  Please don’t get caught with a significant portion of your net worth hinging on any particular forecast — mine or anyone else’s — without protection.

For those of you who who haven’t yet signed up, prices are going up at midnight tonight (PST.)   Current members are not affected, of course.  And, as before, the first 100 annual members are grandfathered for the life of the site.  If you’re a quarterly or semi-annual member, you might want to consider upgrading to annual.  To sign up, click here.

Stay tuned.


Update:  2:30 PM

The 5-min RSI just broke out from a falling wedge on positive divergence.  If it can stay above the upper bound this morning’s decline should be erased, and then some.  Watch for a back test of the wedge, which would correspond with a back test of the little red trend line at around 1311.

Still working on the longer term picture.  I’ll send a message as soon as it’s posted.  At this point, all members should be receiving an email within minutes of when a significant post or update is posted.  Please let me know if you’re not receiving these messages.

I’ve put the texting option back in the sidebar to the right.  Just enter your cell phone and service provider and you’ll be notified of new posts.  Note:  it doesn’t notify you of post updates, just the initial publishing of a new post.

UPDATE:  4:05

That worked out pretty well.  The falling wedge paid off as advertised, turning an 8-pt decline into a 2-pt gain at 1310.50 — just a smidge below our 1311 target.  I hope readers were able to take advantage of it.

Since I didn’t complete the longer-term picture before the close, I’ll work late this evening and try to get it up before turning in.

BTW, I get a number of emails during the day from readers, and I’m good with that.  But, I much prefer that anything market related — questions about strategy, investment options, etc. — go into “comments” on the post.  I’m likely to see them more quickly, and more importantly, your fellow readers might benefit from the discussion.  Thanks!


The Road Ahead — 3 Comments

  1. Hello PW,

    Since I don’t have your email, I have to post a question here.   Sorry about that.

    I have been debating whether to ask you this question.   When you first started the new web site, you only allow the followers to be “chartered members”.   Still, how do you define a follower?   I assume those who had registered before in  (I still don’t know how, but it is too late)

    However, there are people who followed you blog since last year but they never managed to register.

    No offense.  I have been following your blog since last Oct.  And I participated in discussion and your SPX guessing contest. 

    If you still remeber, I raised the question about Mar 2011 earthquake impact to be repeated in May 2012. (which you predicted correctly)

    In summary, no offense, may I be chartered member? 

      • Thanks PW!

        By the way, back to mid-April, you explained analogs.   I raised the question about “March 2011 Japan earthquake” as a natural event, and how could it be repeated in the same time frame to fit the analog?

        You were right on the analysis.  I watched the global market since mid April and they were still rising toward the end of April.  I had some doubt as you had predicted SPX to reach 1314 (since then you revised it to 1290 range.  It was scary to be that accurate) in May 15. 

        In mid April, most of the mainstream media were positive about the economy and stock maket.   It is hard to believe a 8% to 10% sellout in global market in 2 to 3 weeks.

        In May 2012, the global market indeed behaved as if “March 2011 Japan earthquake” were repeated.   It shows the analog is powerful and amazing. 

        People may say it was because of Greece.  That’s why we had the sellout in May.
        However, Greece had problems since 2010.   Did people wake up one day in May and suddenly find out Greece indeed has a problem?