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10 Minute Bar Charts 5/6/02 Dow Jokes Inflatables
Archives 12/30/01, 1/1/02, 1/2/02, 1/3/02, 1/4/02, 1/7/02, 1/8/02, 1/09/02, 1/10/02, 1/11/02, 1/14/02, 1/15/02, 1/16/02, 1/17/02, 1/18/02, 1/22/02, 1/23/02, 1/24/02, 1/25/02, 1/28/02, 1/29/02, 1/30/02, 1/31/02, 2/1/02, 2/4/02, 2/5/02, 2/06/02, 2/7/02, 2/9/02, 2/11/02, 2/12/02, 2/13/02, 2/14/02, 2/16/02, 2/19/02, 2/20/02, 2/21/02, 2/23/02, 2/25/02, 2/26/02, 2/27/02, 2/28/02, 3/1/02, 3/04/02, 3/05/02, 3/06/02, 3/7/02, 3/10/02,3/11/02, 3/12/02, 3/13/02, 3/14/02, 3/15/02, 3/18/02, 3/19/02, 3/20/02, 3/21/02, 3/22/02, 3/25/02, 3/26/02, 3/28/02, 3/30/02 4/1/02, 4/2/02, 4/3/02, 4/4/02, 4/6/02, 4/8/02, 4/9/02, 4/10/02, 4/11/02, 4/13/02, 4/15/02, 4/16/02, 4/17/02, 4/18/02, 4/20/02, 4/22/02, 4/23/02,4/24/02,4/25/02, 4/26/02, 4/27/02, 4/29/02, 4/30/02
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The Anals of Stock ProctologyPublished 5 times
per week by the American Academy of Stock Proctology and AM Features (5/7/02) Mid Day Outlook 5/7/02 The 1 day cycle up phase is still under way. Prices are approaching the pre-market cmaps indicated by the fucutures. The cmaps on the current move are 1176 on the NDX, 1593 on Nas, and still 1057-58 on SPX. If the move goes beyond that, then the 5 day phase is shifting from SWUP to Up. The 1 day (9-10 hour cycle) should be topping out now. Again, if the rally extends in time for more than an hour, it could be a sign that a more significant low is forming. But not likely. We still have a downside 8 day cycle cmap of 1037 on SPX and 1535 on Nas. Regardless of what the Fed does, probably nothing, but maybe a quarter point hike, based on their reigning in the monetary base, the cycle phase should be down after the announcement. Pre Market Outlook 5/7/02 At the bell yesterday we saw multiple nested cycle lows or mncl's beginning to form. The 5 hour, 1 day-9 hour, and 5 day lows all appear to have been put in. The downside cmap for the 5 day cycle on the Nas was 1570-80 and 1048-52 on the SPX. The cmaps for the move in progress at the bell were 1575 and 1048-50. So we should see a bounce early. But don't expect it to last long. We still can look forward to the looming 8 and 13 day cycle lows which are 2-3 and 7-8 days away. On the hourly charts, the cmaps for the 8 day cycle are 1030 on the SPX and 1535 on the Nas. They would be due in two to three days. The fucutures are up, just before 9 AM. The cmaps on the upmove are 1057-58 on the SP's and 1181 on the ND's. Looks like a minimal dead cat bounce to start the day, a holding action waiting for Al, then down at the end. Lullaby (5/6/02) The market put everyone to sleep in the morning, and when the sphincters all had their heads on their desks with their arms folded for nap time, it quietly snuck out the door. When the sphincters woke up, the scratched their heads and said, "Oh my. Where'd my bull market go?" They are starting, at long last, to wake up to the fact that "long is wrong." The decline is beginning to accelerate and go vertical as a result. The short term give-up stage is due to last no more than two to eight days, but a helluva lot of damage can be done in that time. We're in the bungee plunge now. The thing for shorts to do is grit your teeth, and hang on until that quiet moment when suddenly the selling just dries up. Indications are we'll see the Nasty below 1500 and the SPX near 1000 before that happens. But don't worry. It'll just be an interim recoil. There will be a lot more downside to come in the months ahead. The Feed - We've been noticing for weeks how unresponsive the Feed has been to the market's troubles. Today was no exception. They added just $2 billion, after doing nothing on Friday, following a week of pump, then drain. They took back all of the net adds of the last two weeks, and then some. There appears to have been a net drain of about $6 billion since Thursday. It appears that Al is determined to hold money growth down to near flat. Without this liquidity and the excess credit creation from the dying mortgage bubble, the stock market is a hopeless case. Even when we did see massive injections in response to collapsing markets, the effects were only temporary, from a few days to a few months. They did nothing to reverse or slow the secular downtrend. Without that support the downtrend will accelerate as investors and and companies are forced to sell equities to meet cash needs. This is the endgame. Dow Inflatables
The 8-13 day cycle oscillator rolled over, signaling a down phase that can last anywhere from 3 to 8 days. The 4-5, 6-7 and 10-13 week cycle also began to roll over. This could be an extremely bearish development as the indicators are already in negative territory. The downtrend channel is intact, and the index will test or break the lower channel line in the next day or two. The centered moving average projection for this cycle adjusted to 9,675-9,925, but that could certainly adjust lower on more weakness tomorrow or Wednesday. This may still be a developing 10-13 week cycle low. the jumping out window could still be open for another week or so, and it looks like the low will take the shape of a spike, as opposed to a nice smooth rounded bottom. Portfolio Sphincters Index (SPX) and Sentiment The SPX revisited the Norman Conquest and Battle of Hastings at 1066. The bulls lost. The index ended up shedding 20 points to 1052, busting out the lower boundary of a week long triangle pattern. The 17 day rate of change, a proxy for the 6-7 week cycle, continues to flatline at a negative level. My goodness, if that was a sideways up phase, what happens next would be chaos. The 6-7 week cycle oscillator superimposed on the chart has turned down at a weak level, signaling severe weakness ahead. The 29 day rate of change, representing the 10-13 week cycle, is flopping along below the level from which it turned up in February. It continues to confirm the downtrend. The 10-13 week cycle low is due at any time over the next 8 days. That's a window where all cycles could head down together and in which an upturn almost certainly will occur occur. The bottom should take the form of a spike and rebound. The VIX moved up to 24.88 from 23.23. On the inverted scale chart, VIX is now in the center of the Stool Band, confirming the trend, but not anywhere near the levels of fear necessary to signal a bottom. A big intermediate rally probably won't come until the index is below the outer band, i.e. a reading above 30. The blue channel lines are the extension of a linear regression channel from the February and May 2001 highs.
The 5-6 month and 10-13 week cycle oscillators are still heading down. They look like Dover Sole, but as we all know, there's no such thing in a bear market, so we don't know if what looks like Dover Sole really is. We won't know until after the turn. The short cycle oscillator turned down from a low level, indicating that the market could drop like a stone from here. 1050 looks like a potential gap area. The Trading Stoolicator is still heading down. The indicator line is above the smoother. That's only a caution signal. Both lines are still headed down. Taken all together, Doc's best guess is that a cycle low is beginning to form on the 10-13 week cycle, and that the low will be in the form of a death plunge. A sharp drop could lead to a bungee recoil but we are not there yet. Short term centered moving average projections for cycles of 4 to10-13 weeks moved down to a range of 1015-1035. That's the second downward adjustment in two days, as the projections barely stay ahead of the market. This is typical of a market approaching a low, but it could go on for several days with an increasingly vertical angle of descent before the bungee is stretched to the limit.
Fibo support at 1062 broke down. The next levels are 1036 and 1009.
The Cycle Conditions tables include cycle phase and a wild guess as to number of periods to the next turn, in days for the shortest cycles, weeks (W) or months (M) for the longer ones. This is a fluid exercise, in other words, the projections are likely to be wrong, but they force us to be vigilant for key turning points, and frequently work well enough to prevent costly misreadings. SPX Cycle Conditions as of 5/6/02
PTT - Periods Till Turn Nasgap Charts The Nas lost yet another 34.55 to 1577. At the recent rate of 33-34 points a day, it won't take long to get to zero. Then everybody can go home. The short cycle oscillator is headed down, with the down phase in the 8/13 day cycle headed for 1460 over the next 2 to 8 days. The 5-6 month cycle
oscillator is gradually heading down from below neutral. Doc will no
longer use the term "impending disaster", which he has been
using in this spot. The "impending" is no longer needed. The 10-13 week cycle
oscillator is heading down, is accelerating, and is a long way from Dover Sole. Doc's composite trading stoolicator
had flashed a yellow light Thursday, but the indicator turned lower Friday,
confirming the downtrend. The structure of this indicator is such that if
both lines are heading in the same direction, the trend is confirmed.
There appears to be multiple cycle wave band support at 1500. That could
be broken by up to 100 points as the bungee stretches. It's also possible
that those waves are bending lower. A bounce is coming, but the next few
days could be the most lucrative of all for shorts. The next fibo support is 1545. After that 1387. Tomorrow?
Nasdaq Cycle Conditions as of 5/6/02
PTT
- Periods Till Turn Lots of little signs
cropping up that the long term bottom in yields is still forming, and that
intermediate cycles may continue to head lower, along with stock prices. A
break below 5% is looking increasingly likely before an intermediate low
forms. How quickly things change.
All cycles are in gear to the downside as the dirty dirty SOX broke a key
level formerly known as support. Now headed for the the 6-10 month wave
channel lower band near 400. Retail was one of the
leaders of "this bull market", universally loved by The Street.
While they were loving it, someone was distributing it. A major reversal
is about to come to fruition. Was it so long ago when
Biodreck weighting was increased in the Nasty 100? The keepers of the
indices have had an uncanny knack of putting 'em in at the top
lately. Remember when they put MSFT and INTC in the Dow? Where's the low
on this? There are signs that it's close, but the downside velocity is
increasing. Look for a break below 350 first. Stoolwethers - The Generals - Lee and Custer General Lee just made his
northernmost incursion. Think of it as the Battle of Gettysburg. General Custer is, well,
General Custer. Stock may have been in an up phase since mid April. If
that's the case, the down phase will take it to 28 and below. It all
depends on whether GE can maker a stand above 30. Not much chance, Doc
thinks. Stock O' The Day- EMLX Doc is following up on EMLX
because he is beginning to like this chart. This has been a classic
sideways up phase. When oscillators top out in the neutral zone, that is
an extremely bearish sign. The down phase should carry below the long term
channel projection, and begin to turn that wave lower. If you have an idea for a Stock O', send it to [email protected]. Include some original reason for why you think the stock is deserving. Be clever! Anything longer than 25 words- automatic disqualification! And please, no penny stocks. Feel free to request follow-ups too. Uncle Buck's Illness
Since Uncle Buck fell out of bed, he fell through the floor, and keeps
falling faster. The cycle waves are accelerating down toward an inevitable
test of the September low in the near term. Golden Stool The picture of a healthy
first stage bull market, the gold stocks are cycling around the central
regression projection of the centered 250 day moving average. The sell
signal in the 10-13 week cycle oscillator indicates a consolidation phase
is under way. There's no sign that will result in an actual downturn. It
can't be ruled out, but it's possible that the uptrend may simply slow for
awhile during the corrective phase. See you in Intraday Stool. Dr. Stepan N. Stool Let me know what you think on the Stool Pigeons Wire. Previous complete issue with all features Welcome To New Subscribers Welcome, and thank you for subscribing to the Anals of Stock Proctology. You may note some subtle differences in style now that this is no longer a free service. The perspective is still bearish, but it will have a more balanced approach than my message board ravings. You won't see me screaming "BUY" about anything except perhaps gold, but you will see stronger indications of areas and times when I think it might be a good idea to avoid being short. And I promise that I will lose my temper from time to time to keep you entertained! There's also a new feature, Doc's By Request Stock O' The Day. If you have a stock you're interested in, send an email to [email protected], naming the stock, and why you think Doc should look at it, in 25 words or less. 26 words, and you're disqualified! Those that look interesting, Doc will try to feature here within the next day or two. If you have suggestions about other features you'd like to see, send them along to [email protected]. Again, thanks for subscribing!
Explanation of Intraday Commentary-Build charts at http://www.livecharts.com. For custom time bars insert a comma after symbol and number of minutes, e.g. compx,90. This will give you a bar chart of the Nas with 90 minutes per bar. The one day cycle is usually most clear with 8 minute bars and 26/18 stochastics. It varies from day to day. Sometimes 6 minutes works best. Experiment to find the best fit for your trading style, and the market's dominant frequency at the time. The goal here is primarily to monitor the condition of the 8 and 13 day cycles. I typically use 90 minute bars with 26/18 stochastics for the 13 day cycle proxy on the indices during regular trading hours. Other cycles use 26/18 stochastics with the following: 8 days- 60 minute bars On the 24 hour futures charts, use a time per bar approximately 3 to 4 times the above number of minutes, to represent the cycles listed above. ABBREVIATIONS: cma: centered moving average |
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