Traders' Library Blog

Stocata S&P 500 Analysis: February 22, 2014.

"Last week I wrote: "The index not only moved slightly higher as we were expecting, but much higher, almost touching again the median line of the up moving pitchfork and even passing the resistance of the R1 monthly pivot. Monday is presidents day. We will have to wait for Tuesday to find out what is coming next. Not reaching the median line of the pitchfork would mean a downturn past the last low of the wave 1. Reaching the median line on the other hand will most probably bring the index above the last high of wave 3.9, creating a wave 3.10. This last scenario has technically the better chance, but be careful, because the long term reaction down will start (continue) when it is least expected. ".

A consolidation and not yet a new high wave 3.10 while reaching the median line of the previous pitchfork. I created a new last upward pitchfork. We may have a further move up towards the upper side of this pitchfork for a new high wave 3.10. But for now, I would say there is an equal opportunity that correction wave 2 is finished and that a wave 3 down will be started. In that case I expect a move down towards the low side of the BBS band, the median line of the up  moving pitchfork and the support of the 50 day average.

Sylvain Vervoort   http://stocata.org/

Stocata S&P 500 Analysis: February 15, 2014.

Last week I wrote: 
"Last week I wrote: "Last week I mentioned "I doubt if we already have a wave 2 retracement from the last low point. There may be some more upward reaction towards the 50 day average". We had a volatile week with a big move down on Monday out of the up moving pitchfork, next followed by the expected upwards wave 2 retracement to the 50 day average the rest of the week, moving back into the up moving pitchfork. We now have a wave 2 confirmation with price also reaching the PP pivot point of the Month, the upper side of the down moving pitchfork and close to the 50% and 61.8% Fibonacci retracement. The indicators have room for an up move. I first expect some consolidation with possibly a slightly higher index. But after that we should expect the wave 3 down.".

The index not only moved slightly higher as we were expecting, but much higher, almost touching again the median line of the up moving pitchfork and even passing the resistance of the R1 monthly pivot. Monday is presidents day. We will have to wait for Tuesday to find out what is coming next. Not reaching the median line of the pitchfork would mean a downturn past the last low of the wave 1. Reaching the median line on the other hand will most probably bring the index above the last high of wave 3.9, creating a wave 3.10. This last scenario has technically the better chance, but be careful, because the long term reaction down will start (continue) when it is least expected.

Sylvain Vervoort   http://stocata.org/

Stocata S&P 500 Analysis: February 8, 2014.

Last week I wrote: 
"Last week I wrote: "As I mentioned last week "For now there is room for a further move down towards the lower side of the up moving pitchfork, the 100 day simple moving average and the 261.8% Fibonacci target". And that was exactly the point we reached the past week. I doubt if we already have a wave 2 retracement from the last low point. There may be some more upward reaction towards the 50 day average. But since we are looking for a wave 2 retracement, the next wave 3 will be down. That is in line with what I expect looking at the monthly and weekly chart. So, any more up reaction would probably be good to close open long positions".

Last week I mentioned "I doubt if we already have a wave 2 retracement from the last low point. There may be some more upward reaction towards the 50 day average". We had a volatile week with a big move down on Monday out of the up moving pitchfork, next followed by the expected upwards wave 2 retracement to the 50 day average the rest of the week, moving back into the up moving pitchfork. We now have a wave 2 confirmation with price also reaching the PP pivot point of the Month, the upper side of the down moving pitchfork and close to the 50% and 61.8% Fibonacci retracement. The indicators have room for an up move. I first expect some consolidation with possibly a slightly higher index. But after that we should expect the wave 3 down.

Sylvain Vervoort   http://stocata.org/

Stocata S&P 500 Analysis: February 1, 2014.

Last week I wrote: 
"Last week I wrote: "As expected we got a lower index. The past week the double top was confirmed with lower prices with large downward candles on Thursday and Friday. The upper side of a new downward pitchfork formed resistance. A historical downward Fibonacci projection between top wave 3.9 and the wave 2 correction before, gave a 161.8% target at 1793. This level, also the S1 pivot support level was reached on Friday. The expert turned black. We have a new downward wave 1. For now there is room for a further move down towards the lower side of the up moving pitchfork, the 100 day simple moving average and the 261.8% Fibonacci target. Watch your open long positions, this may be the start of a long term correction".

As I mentioned last week "For now there is room for a further move down towards the lower side of the up moving pitchfork, the 100 day simple moving average and the 261.8% Fibonacci target". And that was exactly the point we reached the past week. I doubt if we already have a wave 2 retracement from the last low point. There may be some more upward reaction towards the 50 day average. But since we are looking for a wave 2 retracement, the next wave 3 will be down. That is in line with what I expect looking at the monthly and weekly chart. So, any more up reaction would probably be good to close open long positions.

Sylvain Vervoort   http://stocata.org/