|
Subscriber Sections The
Anals MoGauge © Subscription Help (Login, Password etc.) Free Forums
Resources Market Stats and Kitco Thumbnail Charts Bear
Essentials Marketviews with Ike Iossif Prudentbear.com
Humor Wall Street Follies Financial Funnies Hilarious! by stoolie prolerbear Not
In My Backyard for Capitalstool. Support the Stool! |
We
don't know and neither do they.
Chart
Courtesy of
|
S&P
500 Archive-April The Moment of Truth (4/30/01) Dr. Stool's been saying lots of dumbass things in these last few columns, things like Double Top to the Tune of Hammer Time, Tippy Top, lots of nonsense like that. We have reached that point where the market must now deliver, or Dr. Stool has to take his Haley's MO. Monday looked like the tensing up for the big dump. The index looked like Pamplona in the morning. The bulls were stampeding over everything in site. The specialists and market makers spent the morning absorbing the frenzied buying near the the Spoox's price objective of 1268. Then we heard the first big plop around 2 PM, as the bulls finally finished their gorging, but market insiders continued to disgorge. The crack in the advance worried no one. The complacency is so thick you can cut it with a knife. The daily oscillators are extended, and the 21 day stochastics are on the verge of their first sell signal. The index has reached its price objectives twice in the last week and a half. It has been unable to sustain a breakout through a significant resistance level. A downturn in stochastics and a break below 1235 will confirm that the down phase of the 6-7 and 10-11 week cycles are under way. That's why it's the moment of truth. The market will tell us in the next few weeks what was really been going on in April, a new bull market, or April Fool. Market Euphoria and the Long Bong Hit (4/27/01) What exactly is a test? It's a test of a previous point of reversal, a test of will and conviction between bulls and bears, a test of whether market insiders have decided that enough is enough, whether there is more or less risk to their trading positions in allowing the market to proceed. The broker-dealers who take the opposite side of all that mental institutional buying will take a look at this market Monday morning. They've had to absorb a lot of demand over the past few weeks, and Dr. Stool thinks that after being heavily long following the March debacle, they are either neutral or slightly net short. They'll need to decide if the bulls are spent or not, and either cover their shorts and let it break out, or push back hard, absorb the buying with more short selling, and reverse it. You can be assured that the portfolio shrinkers will be buying, not selling, because they always follow the herd, and the herd is figuring that the Fed is easing and the economy is recovering. They are bull sure of their figuring. So, will the dealers and traders put a stop to it? Here are the indications. Centered moving average projections have been aimed squarely at this level as the top of this move for a number of days. Friday's rally caused those projections to inch ahead only nominally to about 1265-1268 for the shortest waves, and 1255 for the 5-6 and 10-11 week cycles. The rally has lasted for 18 days, which is about as long as any rally has lasted in the last year. The up phase of the cycle actually began at the first low in late March, and the 10-11 week cycle is about 27 days old. Indicators which measure swings of emotion in buying and selling are at extremes. The news has been interpreted as extremely good for the future of the economy (which isn't true, but bulls have never been know to concern themselves with facts) In spite of the huge rally, long term downtrend channels are intact. Those are the facts. They suggest, but they don't guarantee, that the stampede has just about spent itself. Dr. Stool suspects with the hit on the long bong approaching 6%, that will be enough to stone the market. Tippy
Top (4/26/01) The last wave of latecomers kept the Spoox positive Thursday, but the index is again lagging the Dow "safety net". Upside projections are coalescing around 1250-1260 and there's still no signal that the uptrend has been reversed. Be prepared for another attempt to test the high before this up phase runs out of gas, which should happen within a day or three. Lemme Hear Ya Say Double Top (To the Beat of Hammer Time) (4/25/01) The Spoox led the party Wednesday by gaining 1.5%. The portfolio shrinkers were dancing in the aisles as they celebrate the new bull market. Meanwhile broker-dealers were successful in stemming the selling which had started too early to allow them to build short positions. The portfolio shrinkers came in, took the fake, and were off to the races. And who do you think was selling to them? Dr. Stool doubts that public and mental institutional buying will be sufficient to allow market insiders to get heavily short again. This would take weeks of strength. Time has about run out on this cycle, and daily indicators are toppy. Furthermore, there has been no change in centered moving average projections. Those are still pointing to highs of 1245-55 on all cycles up to 10-11 weeks. If the market makers are unable to build large short positions the next down will be at least as bad, if not worse than the last one. On the other hand if they can keep them churning up here for a while, the next downleg will be shallower than the last. Don't expect anything exciting, one way or the other, for a couple more weeks. The big caps are under distribution again. It's boring and it takes time. But the shape of the top will speak volumes about the future. So stay tuned. Complacency (4/24/01) is the byword, as the shorter cycles begin to get back in gear with the primary trend, which is, for those of you who just stumbled on to Capitalstool.com, of course, DOWN. The majority of portfolio shrinkers are convinced the market is simply digesting its gains form last week's huge rally. Stool Pigeons know otherwise, however. Yeah, yeah, they dumped the big one on us, and some of us (ahem) were a little slow to react, but the market is, after all, an equal opportunity destroyer. The topping out phase of this rally is well under way, maybe even behind us already. We know the rally was a put up job by the Fed in a transparent attempt to run the shorts, and in the market, stuff that phony usually gets reversed post haste. Just consider this, the bulls think this pullback is a correction, and the bears are scared to death of the same thing. Most of the biggest bears, whom Dr. Stool reads on a daily basis, have been saying over the past few days they think the market will go at least a little higher here. Since Dr. Stool is about the only idiot out there who's been screaming TOP TOP, the limb he's on feels mighty shaky. But he's gonna stay out there, because he looked in the stock proctoscope, saw the market coming down, and it sure looked like the market. So he had no choice. Remember, Don't fight the procto! Centered moving average projections indicate cycle highs for all waves from 13 days out to 10-11 weeks to be 1245-55. That's a little lower than yesterday's projections, and is an area we've seen already. Short term stochastics are confirming a top for at least the 4-5 week cycle, but the other indicators have not confirmed as yet. That doesn't concern Dr. Stool, as sell signals are often late in a bear trend. Finally, there are early downside projections for the 8 and 13 day minor waves, which are pointing at the 1185-95 area. The bulls should mount another charge from there. But the next high will be lower. From
Smartass To Dumbass in One Easy Lesson (4/23/01) They will buy more in the days ahead as the market ratchets down, convinced, like Myron Cant Tell, that the new bull market is underway. They do not understand for one second the true nature of the rally, which Dr. Stool discussed in the weekend columns below and on the Dowager, and Nasty. The panicked short covering, and the margin calls on overextended shorts are over. The public shorts, who came late to the party are wiped out. The portfolio poopers are fully invested again. The 401Ks have all paid in. Now where are the buyers going to come from? Dr. Stool would not be surprised to see the Spoox to continue down from here in an orderly stair step decline, without ever retesting the highs we saw last week. Dealers are now net short as a result of the upside explosion, so they will absorb any heavy selling in the short run. Dr. Stool is guessing they will want to stay net short, so they'll keep the market from falling apart directly. But inevitably the drips will turn into dribbles, the dribbles will begin to run down the legs of the portfolio pukers, and eventually they will lose bowel control and begin dumping all over again. That's how bear markets work. The upside objectives on the cycle projections remain in the 1240-1265 range on the SPX. With a high of 1253 last week, that appears to have been it. Look for a drop below the 53 day average to confirm. Lest
There Be Any Doubt (4/20/01) We can see that the rally started where it did because the market had descended to a long term support trendline, where the portfolio pranksters decided to mount their last stand in defiance of the bears. The bears were massively short stocks and derivatives. Alfred E. Newman Greenspurts decided that this would be a perfect time to spew more gas on the conflagration. In daily life, the market went into a vertical crash-up, as the mammoth short position went up the smokestack of the Fed-Wall Street gas boiler. Now the options have expired, and the squeeze is over. Huge speculative short positions have been wiped out, along with the future buying power those positions represented.
And look at the monthly chart. Nothing, nada, zip, zilch. The trend is exactly the same as when the crash-up started except for one thing. No more long term oversold. No more massive short pool to prop up the market when it starts down again. Horrendous long term mo, and no bull market in sight. Dr. Stool got blown out last week by focusing too much on short term cycle forecasts while daily momentum indicators were still bullish. There's simply too much guesswork involved until the cycles actually are at, or at least very near, their tops. So he underestimated the cycle highs perhaps by 4-5% (so far). The big Fed fart was part of the problem, gassing the situation way beyond where it otherwise might have gone. The short term stochastics on the daily charts reached 100% at one point last week, a mind bending level of hysteria. On the other hand, those indicators never turned bearish, so it would have been wise to pay heed. They are getting toppy now. Looking at that long term chart, the basic premise still looks dead right. So here we go again with those forecasts. The 10-11 week cycle projected high is now 1255. The 6-7 week projection is 1245 and the four week is 1250-1265. The 13 day cycle projection was 1247. Thursday looks like the high in that wave. On the whole, if these projections are correct, the rally has topped out. A selloff early next week would confirm. Capricious Lover (4/19/01) No matter how much you love the market, no matter how faithful you are, always remember. It doesn't care. Just when you get to feeling pretty good about yourself, it will remind you of that. As Dr. Stool said in his current comments on the Nasty, he placed too much faith in his cycle projections, which have done pretty well this year but depend on a lot of guesswork early in the cycles, and not enough reliance on the action of the daily chart indicators. They have been consistently right, and they haven't shouted sell yet. But making projections is part of the challenge, so lets get back on this pony. We're now looking at 1280-1300 on the 6-7 and 10-11 week cycles, and 1245-1260 for everything shorter. That would suggest a pause here, then one more spurt before this madness ends. You're seeing extreme hysteria indicated in the stochastics, and long term downtrend lines overhead. This still must be classified as a bear market rally. Helluva Bottom (4/18/01) Just look at that daily chart. What a gorgeous double bottom. As a Stock Proctologist, Dr. Stool studies bottoms. There was one right in front of his face. Why didn't he see it? There are two possibilities. He's blind as a bat. Or, it was just as he said it was, a 21 week cycle low that will lead to a "sideways up phase" in a bear market. If he's right, that sideways up phase sure got slanted up there Wednesday. And the rally sure did blow out the upside objectives of 1225. Did Greenspurtz just shoot up the Spooox a little too much? Now that the short term price objectives have all risen to 1245-55, and the Spoox is there, the logical conclusion is that the market overshot its targets on the upside, just like they did on the downside, and that's all. If things are really different, we'll have to wait out the pullback to know for sure. Dr. Stool ain't buyin' any of this vertical mania crap. It smells bad. See No Evil Phase (4/17/01) Things always look rosy at the top. That's because the bulls all have their eyes closed, and all they can see is the back of their eyelids. The Spoox is closing in on the price objectives Dr. Stool has been repeating ad nauseum for a week and a half. In spite of all the strength, the highs for all waves from 13 days to 10-11 weeks are projecting no higher than 1200-1225. Interestingly, the eight day wave only projected to 1188. The portfolio punks will seize on Intel beating minimal earnings expectations by all of a penny, to pour the remainder of what they have left into chasing the big tech stocks. This is a futile attempt to resurrect their cratered portfolios. It is no more than throwing good money after bad, after doubling down, and doubling down, they are doubling down again. They will run the last of the holdout shorts, and then, it will be over. The blowoff will be Wednesday. The stocks will start coming back to earth after that. Although they'll try and keep 'em high, it's all over but for the shouting. Talk
About Manipulation (4/16/01) Hope springs eternal. And more retirement funds have been lost because of hope than any single human emotion. But the people who are running your money don't give a crap about your retirement, that's for sure. They're trying to support the market by selling bonds and buying stocks, and it won't work If you are an investor there is absolutely no point to being early in your search for a bottom. It's suicidal. The market is going a lot lower. And if you are a trader, there is no excuse to trying to trade this market from the long side...unless you are sitting in front of a trading screen and scalping. Even so, Dr. Stool wouldn't sit too long, and put your shorts on! Only
Two Possibilities (4/13/01) Hmm, let's think about that. What do you think the answer is? What do you think Dr. Stool's answer is? CORRECTAL! As for numbers, the price objectives remain in the 1205-1215 area for most short term cycles. The rally is in its terminal stages. If that's not the case, then Dr. Stool is just another market-letter writing moron, and all the pundits on Wall Street are trustworthy geniuses, with only your best interests at heart. That reading on the 21 day stochastics is 99.99%. Unbelievable that the market could have gotten that ebullient in so short a time, but that's what it did. Let's see if Dr. Stool can find an analogous period. Oh, here's one. July, 1930. Bloated,
Gassy, Stopped Up Market (4/11/01) Yesterday's high got within 1 or 2% of the projections for short term cycles. The failure to extend has caused those projections to adjust down to the 1175 to 1203 area. The projections for the 4 week and 5 week cycles dropped to 1180, which was met Wednesday. So it would appear that the Spinster is already beginning to form a top in here. That process should take several days. The hourly stochastics for the 8 day swing cycle is toppy, but there's been no clear sell signal yet. There's still a p.o. on that cycle of 1203. If it gets there, that'll be the final flatulent stoolburst of this bull moon rally.
Shortselling
is a Double Edged Sword (4/10/01) As a result of this "crash-up", cyclic price objectives have risen slightly. The 5-6 week, and 10-11 week cycles are projecting to 1200, with an outside possibility of 1240. All remaining short term waves from 5 days to 4 weeks are projecting to highs of 1190-95. The 4-5 month cycle low now appears to be confirmed but it's too early for an upside projection. The Spinster's long term wave has a width of about 200 points. The upper edge of the channel is now in the area of 1250 and declining. Any up phase will be contained within that downtrend channel. The last two intermediate rallies have run about 130 points. A similar rally here would top out in the 1210-1230 area, which is consistent with cyclic projections. We're the Facawi (4/9/01) Let's see. We've made a 10-11 week cycle low, and probably a 4-5 month low as well, although that's not as certain. The bottoms of the 10-11, 6-7 and 4 week cycles are confirmed. The only one where Dr. Stool has been able to see an upside projection was for the 4 week cycle, which indicated a high of 1160, and we've been there already. Same for an 8 day cycle high of 1170. So our bear party is over for a few weeks, but the bulls have nothing to get excited about. But just you watch, after a few weeks of a sideways market, they'll get it up pretty good. Except for Myron Cant Tell, over at Al Capone (aka AOL's CNN) Moneyhype, the bulls have been pretty cautious about calling a bottom here. But they are nibbling, and the bears all got blasted last week, and yesterday, and they're extra trigger happy now. The bias is likely to continue to the upside, and that'll be enough to halt the downtrend in its tracks. Keep your ears open for the bulls to start snorting and sniffing bottoms again. When you here that growing chorus, it'll be time to short 'em again. But for the next few weeks, take a break and let the trading range work itself out. So Much for Being Impressed (4/6/01)Half of that huge one day rally, gone, poof, on the opening. If you covered your shorts late Thursday, Friday morning the only thing to say was "Ouch!" The problem, and the reason for these monumental one day spike rallies is that a lot of newcomers have recently been converted to the short side. If you don't believe it, check out the short interest data on both the Nasty and NYSE. Everything's already been sold, twice! There's a very real shortage of stock to buy when anxious shorts try to buy the same share of stock the bulls are chasing. And don't think the market makers and institutional traders aren't looking to run the shorts. They're looking, all the time. Fortunately, that kind of phony buying can't be sustained in this environment. Usually it's just part of a strategy to get prices up so that these guys can unload some of the crap they're holding. There's a mountain of overhead supply ready to crush any advance. That's why these things go in cycles. It's just a never ending tug of war. No question, the bears are winning. March 22 was the cycle low for the 4 week through 10-11 week cycles. The SPX is now working its way sideways as the up phase of those cycles heads across the collapsing long term wave. The four week cycle should be getting ready to turn negative, but all cycles will not be in gear to the downside for another three to four weeks. We could be in for a frustrating period with lots of choppiness over that time frame. The 4-5 month cycle low projects to a closing price of 1060. The most likely time frame is late May through mid June. Based on the cycle work, Dr. Stool does not see a crash, just a lot of grinding gradually lower. If the market is going to crash, the best time for it cyclically is September-October. Sound familiar?
I'm Impressed, Are You Impressed? (4/5/01)Some bears cashed in their short chips and others just dropped them in their chairs as the market took off on another classic bear rally. We'll call this a bear chip rally. It's like a blue chip rally, only brown, and, well, you get the idea. Dr. Stool sniffed this coming, but he didn't expect it all in one day, that's for sure. And when half the gain comes on a gap opening, now that is annoying as hell. So here we have some more of that moronic action that periodically interrupts an orderly bear trend. It looks like a perfect double bottom, so all the amateur chartists on Wall Street are foaming at the mouth, dropping the B word like the bullstool that it is. Meanwhile, all this is, is a continuation of the sideways 10-11 week cycle up phase we've been in since March 22. Now we go up to the top of the wave band, suck in everyone in the world who has any jingle left, and then a week or two from now, flush the toilet. Upside centered moving average price projections are 1170-80 on the very minor five day wave, and possibly 1200 on the 4 week cycle. Dr. Stool is definitely not buying this rally, but he's not putting his shorts back on yet either. Oops (4/4/01)Dr. Stool may have gotten a little too excited there. (See below) The Spinster held on after breaking briefly below 1100. As a result the projections for the five through 13 day cycle lows have inched up to 1075-1090. Considering that yesterday's low was 1092, that's close enough for Dr. Stool. The six and ten week cycles are still projecting no lower than 1100 as well. The bulls are probably going to jump all over this, proclaiming a successful test. So there is some vulnerability to a little pop over the next few days. The 4-5 month cycle is currently projecting to 1040-60, up from 1000 yesterday. If the rally does materialize, and if it gathers any upside mo at all, it's going to pull those downside projections up. Bears, the next few days are a time to tread lightly, pay attention, and don't lose your bear chips. Test Schmest (4/3/01)The "test" of the 1100 level is here. And it got here a lot quicker than Dr. Stool expected. Will it be successful? No. Tuesday's weakness was so pronounced that it's a clear signal that all cycles remain strongly skewed to the downside by long term cycles. It is unlikely that the prior lows will hold, under these conditions. The 8 day, 13 day, and 4 week cycle projections are now indicating a low of 1025. That would be due late next week. The 4-5 month cycle is now projecting to a low of 1000. The most probable time frame is this month. The argument that we are due for a really big rally, because of the size of the decline is pure hogwash. The big bear market rallies come in the early stages of the bear trend. As bear markets mature, the rallies tend to be short and weak, rarely exceeding 10%. So don't even think of trying to catch a bounce. More Nothing (4/2/01)The SPX tried a brief rally as part of the process of top formation for the 13 day cycle. The 8 day wave now has a downside projection of 1120. There are no projections for the 4, 6, or ten week cycle. Intermediate cyclicality is positive, but will not be enough to overcome the powerful downside momentum of the 21 month cycle. Dr. Stool thinks the SPX will remain stuck in a downward drifting trading range, leading to a test of the 1100-1120 area and another pathetic rally or two before all the intermediate and short term cycles get in gear and break down decisively. That scenario could take a week, or a month. That's a best cast scenario. It assumes all remains relatively quite on the world political and financial stage. If events conspire against stability, the cyclical position of the market is extremely vulnerable. The psychology simply will not be there to help the market bounce back, like it did in 1998, if there's an explosion in world affairs or international finance. |
|
