Technical Analysis: Are We There Yet?

By: Gordon Long | Tue, Mar 1, 2011
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The market action since March 2009 is a bear market counter rally that is presently nearing a final end in a classic ending diagonal pattern. The Bear Market which started in 2000 will resume in full force by late spring of 2011.

We presently have the early beginnings of a 'rolling top'. We are seeing broad based weakening analytics and cascading warning signals. This behavior is typically seen near major tops. This is all part of a final topping formation and a long term right shoulder technical construction pattern.

Highlight examples of weakening analytics and warning signals are as follows:

- Rising Termination Wedge pattern in the Industrials and S&P 500 since the July 2010 lows.

- Elliott Wave, Gann and Weekly/Monthly Full Stochastic confirm ending rally highs near at hand.

- Significant Bradley Model Turn Date of February 18th.

- Asian & World Market Weakness Leading US Markets

- Fibonacci Cluster Dates showing reversal timing.

- Inter-market Divergence with new highs in the Blue Chip DOW Industrials with lower closes in the S&P 500, Nasdaq, Russell 2000 and Trannies

- Extreme Bullish Sentiment indicators from every methodology we track.

- Bearish Divergence between 10 Day Advance / Decline Line Indicators (NYSE, NDX, RUT) versus Price

- Confirmed Hindenberg Omen from December

- Weakening Breadth - 10 DMA A/D Line versus NYSE, NDX and Russell 2000 price.


CURRENT MACRO EXPECTATIONS

OUR CURRENT MACRO EXPECTATIONS FOR FINANCIAL EQUITY MARKETS
The following schematic best represents the US S&P 500 Stock Index

Macro Expectations for Financial Equity Markets

SIMPLE GANN ANALYSIS

Gann Analysis

ELLIOTT WAVE COUNT

Elliott Wave Count

CHANNELS ANALYSIS

Channel Analysis

S&P 500 TARGETS

Near Term Support

We see the near term support to be approximately 1222 on the S&P 500. There is a possibility the sell off may gain momentum and find support at the lower end of the band (see bottom chart) at 1169 but we are skeptical of this because it is unsupported by Gann Analysis.

Intermediate Term Top

Our target for an Intermediate top is 1344 on the S&P 500.

Time Frame

We presently see this Bear Market counter rally which started in March 2009 ending 2011.45. This approximates to June 13th, 2011

We see strong support presently in the 1222 range on the S&P 500. This should hold any sudden fear from event news breaking on the Geo-Political from in North Africa and the Middle East.

Support ans Resistance

 


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Gordon Long

Author: Gordon Long

Gordon T. Long
Publisher - LONGWave

Gordon T. Long

Gordon T. Long has been publically offering his financial and economic writing since 2010, following a career internationally in technology, senior management & investment finance. He brings a unique perspective to macroeconomic analysis because of his broad background, which is not typically found or available to the public.

Mr. Long was a senior group executive with IBM and Motorola for over 20 years. Earlier in his career he was involved in Sales, Marketing & Service of computing and network communications solutions across an extensive array of industries. He subsequently held senior positions, which included: VP & General Manager, Four Phase (Canada); Vice President Operations, Motorola (MISL - Canada); Vice President Engineering & Officer, Motorola (Codex - USA).

After a career with Fortune 500 corporations, he became a senior officer of Cambex, a highly successful high tech start-up and public company (Nasdaq: CBEX), where he spearheaded global expansion as Executive VP & General Manager.

In 1995, he founded the LCM Groupe in Paris, France to specialize in the rapidly emerging Internet Venture Capital and Private Equity industry. A focus in the technology research field of Chaos Theory and Mandelbrot Generators lead in the early 2000's to the development of advanced Technical Analysis and Market Analytics platforms. The LCM Groupe is a recognized source for the most advanced technical analysis techniques employed in market trading pattern recognition.

Mr. Long presently resides in Boston, Massachusetts, continuing the expansion of the LCM Groupe's International Private Equity opportunities in addition to their core financial market trading platforms expertise. GordonTLong.com is a wholly owned operating unit of the LCM Groupe.

Gordon T. Long is a graduate Engineer, University of Waterloo (Canada) in Thermodynamics-Fluid Mechanics (Aerodynamics). On graduation from an intensive 5 year specialized Co-operative Engineering program he pursued graduate business studies at the prestigious Ivy Business School, University of Western Ontario (Canada) on a Northern & Central Gas Corporation Scholarship. He was subsequently selected to attend advanced one year training with the IBM Corporation in New York prior to starting his career with IBM.

Gordon T Long is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, he recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.

The information herein was obtained from sources which Mr. Long believes reliable, but he does not guarantee its accuracy. None of the information, advertisements, website links, or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. Please note that Mr. Long may already have invested or may from time to time invest in securities that are recommended or otherwise covered on this website. Mr. Long does not intend to disclose the extent of any current holdings or future transactions with respect to any particular security. You should consider this possibility before investing in any security based upon statements and information contained in any report, post, comment or recommendation you receive from him.

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TRUE MONEY SUPPLY

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