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Public blog posts only as education and entertainment. private membership market updates reflect my view and analysis of the market. The information contained on this website and from any communication related to the author’s blog and charts is for information purposes only. The chart analysis and the market comments do not hold out as providing any financial, legal, investment, or other advice. In addition, no suggestion or advice is offered regarding the nature, profitability, suitability, sustainability of any particular trading practice or investment strategy. The materials on this website do not constitute offer or advice and you should not rely on the information here to make or refrain from making any decision or take or refrain from taking any action. It is up to the visitors to make their own decisions, or to consult with a registered professional financial advisor. And i absolutely discourage trading options.

Tuesday, April 26, 2011

$vix and market close update (14 charts pattern analysis)

PS. Apr 27 9:00am ET: a special 12 pages morning report issued to private members.

Pelican,
imho, the IHS is not probable. this one has been talked by almost everyone for a while, it's "well known" now. often a pattern known by everybody won't play out, and usually ends up in the other direction.
i covered it at the today's members update. the consolidation stage started with a false HS, and ends with a false IHS, it's a completely balanced structure of the new pattern i covered to members. also looking into the context of just one index of $spx for this pattern is not proper, should also check into other indexes for uniformity as a complete analysis. this IHS does not exist in other indexes. also other factors, eg. code blue pattern, wedge, ew ... making this IHS highly unlikely. today is the anniversary of the top prior to the flash crash. imho, there won't be a crash in code blue.





both $spx and $indu are around the code blue top. $rut has some room to grow.
despite today's market rally, financials are still not too far from code blue bottom.
my code blue observation is a pattern, the results of code blue pattern from past several occasions i know all ended badly.

even though $spx made a few points higher high above 2/18's, still within the range of consolidation stage of the new pattern introduced today.
consolidation version of $indu and $rut are listed. all defined by the green and blue pitch forks.

if both code blue top and consolidation top surpassed in a meaningful way and stay up, then it would turn to bullish with much more upside. but before that occurs, i like to stay on my code blue pattern course and not distracted by the short term volatility.

current $indu and $spx pattern rhythm well with year 1979~1980 pattern, both ended with expanding triangle diagonal, then followed by a higher expanded flat wave-B.
interesting that current sliver parabolic climax run is similar to 1980's climax run of gold and silver. an example of SLV vs 1980 GOLD is listed of the initial Downtrend stage, they looked so alike.

$vix reached LT lower brown trend line extended back into Oct 2007. (Oct 2007, May 2008) touched & bounced off on last Friday.
i noticed $vix often bottomed a few days before the market top, for example $vix bottom on Feb 16, 2011, then market topped on Feb 18. here we also have $vix potentially bottomed on Apr 20, 2011 prior to todays's market rally to new highs.
$vix bottomed at MT trend line with ST bullish wedge.
short term unfavor to bears is fear factor turned from yesterday's extreme complacency level to neutral zone. maybe a smaller rally into FOMC tomorrow?