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SP500

Updated: Oct 4, 2022

The second part of the analysis is included below :


The first diagram shows the current swing down . From the 5th Jan 2022 Top price has declined around 25% so far into the 30th Oct. The first swing down measures 704pts in 51 days - the second leg down measures 1001pts in 79 days and the recent swing down from the 16th Aug Top measures around 741pts in 45 days so we have overbalanced the first range down by around 40 points yet we are well below the second range down of 1001pts so it looks like we are fairly well balanced in price against the first swing down so we could use this as a rough price guide . There are two Cycles that we appear to be running against which are outlined on the page the first being 2002 which is the 20 Year Cycle and also 2011 - 2012 the 10 Year Cycle . If we examine the 2002 model we can see that price moved up into the 22nd Aug where Top was reached for an advance of 24.5% then down into Bear Low on the 10th Oct a decline of 20.42% in 49 days followed by a strong move up into the 3rd Dec which took around two months . Notice that the price move was 49 days down a decline of over 20% so the time period balances fairly well against the current swing down but there is a percentage price difference between both swings . If we subtract 20.42% from the 16th Aug Top we get a price of 3442 which would balance the amplitude of the previous swing so this could be an important measurement to write down and observe . The next Bear Campaign is 2011 which saw price drop from the 2nd May to the 5th Oct a decline of 21.61% in around 157 days so if we compare this against the current move down we can see that from Point AB we are presently down 25.62% so we have have overbalanced that movement by around 4% on the downside and we have exceeded the 157 day time period by over 100 days . It is interesting to note that both of these past Cycles saw counter trend Top in late Aug with the 2011 Top coming in on the 31st Aug at 1230 followed by a significant 12.69% drop into the 5th Oct for Bear Low so both models point towards a Seasonal Low occurring in mid to late August - the time period down was 36 days which is shorter than the present projection and the decline of 12.69% is also less than the current swing but the two dates of the 5th and 10th Oct present a significant time marker . Examining the 2018 Bear Campaign we dropped 35% into the 2191 Low which gives some perspective against the current move down which is presently around 25.62% off the 5th Jan peak so we are well short of this level but it is handy to measure the current swing and compare it against past campaigns which can give us a guide on what to expect into the future . We are approx 45 weeks out from the 2018 Bear Low so this could also present a significant turning point but it has to be calibrated and balanced against other Time measures. At the bottom of the page I have presented a few price calculations or observations which are not definitive levels however they will provide us with some structural framework to monitor as we move into the main Cycle dates .

On the second page I have presented two Curves for the SP500 which are the same but the one on the right hand side depicts the 1HR chart which goes into a little more technical detail . At this point we have had a strong and sustained move down with only one minor counter trend reaction from the 8th - 13th Sept a five day movement of 233 pts within a down move of 741pts so we could be due for another small counter trend movement which is what I am concentrating on . Curve No 1 indicates Main trend down into the 17th Oct -/+1 which links in with two Cycles and one time count . If price continues to trade lower over the next session we could see a very short term Low on the 3rd Oct then the possibility of a move up into the 10th - 11th Oct for Minor Top then down into the 17th Oct where Main Low is indicated . As the primary force is down I would be very careful about trading the long side at this point as any possible up moves could be short in time and small in amplitude . The 3rd October is only a small magnitude Cycle which may setup as Low but as the dominant force is down it will most likely require a strong Cycle or the convergence of several points to halt this decline so be wary of taking long positions off the 3rd Oct potential Low as its only purpose is to provide us with a time marker to confirm if we are moving up into the 10th - 11th Oct counter trend Top which is the opportunity that I am looking for to go short .

As outlined in the diagram the first time period down into the 6th Sept Minor Low was 21 days a decline of 439 points so if we project 22 days down from the 12th Sept Top we get around the 3rd - 4th Oct as a potential Minor Low and 439 pts projected down from the 4325 Top = 3680 so we have overbalanced the previous price swing by a fair margin . If we do setup for Low into the 3rd Oct it is 7 days up into the 10th - 11th Oct which balances against the previous upswing and once the low point is established we could project the 233 point range to the upside to establish a potential price target to watch . So the main emphasis is to use that small 3rd Oct Cycle as a guide to help us determine if price is going to move up in line with the Curve and setup into the 10th Oct Top and if this scenario transpires a few days beforehand we should be able calculate and pin down two significant price zones to watch and then we could continue down into the 17th Oct where Main Low is indicated .

The second diagram is the 1hr chart which outlines an interesting pattern that is highlighted in green pen - notice the small micro rally into the 2nd Sept before price dropped declined into the 6th Sept main Low - this micro rally was 115 points and was the precursor to the counter trend move up into the 12th Sept Top - Notice the second green circle showing another micro Low of the same magnitude and time period on the 27th Sept a rise of 113pts then the subsequent drop below this point into the current 3584 Low . This structure reinforces the possibility of a Low into the 3rd October which will be our first marker to establish if we are moving up in line with the Curve and setting up for counter trend Top into the 10th Oct . I am still in the process of trying to get my old GT program up and running which has been very difficult so hopefully I will have that setup soon which will be a big improvement in presentation and picture set up .


Part Two :


If Low holds at 3584 which is opposite the Degree of the Sun we could be up till the 10th - 11th Oct where minor top is indicated . Since the 16th August Top there has only been one counter trend reaction from the 6th Sept to the 12th Sept a time period of 6 days + 233pts.

Comparing this move against the projection into the 10th - 11th Oct would see price balance at around 3817 whilst still remaining under the 6th Sept 3886 support level . The projected move up from the 3rd Oct Low into the 10th Oct measures around 7 days which balances against the previous counter trend time period . If this scenario does play out and we get top on the10th Oct we could be down till the 17th Oct where main Low is indicated . Two Squares up from the 3584 Low = 3827 which is close to the 3817 target zone so if we continue to move up into that zone we should be able to qualify one or two accurate price zones to monitor . It is interesting to look back at the 2002 and 2011 Cycles which both had Bear Lows into early - mid Oct with both lows breaking below previous support levels even though marginally which matches against the current position of the market . The 2002 Low came in at 768 breaking the previous low by only 7 pts with the 2011 Low on the 5th Oct breaching previous Low by only 27pts and in both instances counter trend Top was made in the third week of August matching against the current 16th Aug Top . If price follows the Curve and moves up into the 10th Oct for Top we could be down 240 pts which would take us below the 3rd Oct 3584 Low so it will be important to watch price action over the next few days to see if we are moving up into the 10th to setup for Counter Top . My strategy is to wait for this movement to occur as it can be quite risky to trade against the predominant force which is down and by waiting for an opportunity to enter short we have this timing structure in place and we will see if price adheres to the Curve . If we do run down into the 17th Oct or around that point we should consult the 2002 and 2011 Chart as a guide to future direction and price amplitude. In 2011 Low was made on the 5th Oct and moved up 23 days and advance of 20% into the 28th Oct and the 2002 Cycle moved up 55 days and advance of 24% into the 3rd Dec so the two time periods are different but the percentage increase from both Lows is fairly well balanced in terms of amplitude. At this point it would be wise to concentrate on the 10th Oct target date and then once this point is established we can asses the pitch of trend and how price is moving down into the 17th Oct projected Low . There are another two additional dates which I have included which could set up as Top but we will have to wait for the market structure to become clearer as we approach these dates as they are some way off but two Curves have been presented below for future reference .








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