Is This Rally In The S & P 500 For Real?

10 thoughts on “Is This Rally In The S & P 500 For Real?”

1. Inq,

   Providing the monthly Triangles remain in a negative mode I expect to see the market go lower. Eventually the market will turn up and we will be in a bull phase. I do not believe that this is going to happen on this rally.

   As far as my 500 prediction goes.I believe it was a simple swing measurement from a major pivot point that predicted the move to 500.

   We will see how it works out.

   Adam

2. Hi Adam,
   Thanks for the explanation. Is there a specific reason you see the markets down hereafter? I mean any specific reason this is not a start of the bull market vs. a bear market rally?

   Also can you explain how you get 500 values for the S&P.

   Elliott wave chartists are predicting a decline as well.
   Thanks

3. Christmas rally of December 2008 three times penetrated the 61.8% fibo level of maximum: 11/05/2008; minimum: 11/21/2008; and touched only once the 61.8% fibo level of maximum: 10/14/2008; minimum: 11/21/2008, so the penetration of the previous 61.8% level (which was stated in the earlier Adam's video) does not mean much and depends on what to use as control points. Because of that I find the Fibonacci levels approach very subjective and don't rely on it more than on the coin flip: 50/50 - the fibo level will either be penetrated or will be not. I have another idea: the price channels. Market bounced back from the channel borders which are formed by the closes of the SP500 continuous contract on 11/4/2008, 01/06/2009 and 03/26/2009. The lower check points for the channel are 10/27/2008, 03/03/2009 and 03/09/2009. In my opinion the failure of closing above roughly 835.00 level will only mean that we should be looking for the retracement within the channel and congestion like it was from mid-January to mid-February. And this congestion will later show the significant levels of support/resistance. And you will know these levels only after the fact. However, staying the price within the above mentioned price channel will mean to me the continuation of the down ward trend.

   1. Vladimir,

      Thank you for detailing your thoughts so well on Fibonacci.

      I do agree with you that with the main trend still down we are likely to roll over and continue to the downside.

      I am for now sticking with my downside target zone of 500 on the SP500.

      Thanks again for a very detailed comment.

      Adam

4. Hi Adam,
   Nice video. With the new marketclub software have you guys removed the quarterly charts?

   Also, how do you decide whether to use the weekly or monthly charts?
   At this point do you expect the markets to go to the 61.7 retracement and then continue is downward journey?

   Thanks

   1. Inq,

      Thank you for your feedback.

      We expect to include the quarterly charts in the near future.

      On the indices, we use the monthly Trade Triangles for trend and weekly Trade Triangles for timing.

      I expect to see the market reverse back down. It may happen as early as next week or it may take longer. The market will tell us what it wants to do in the long-run.

      Thanks,

      Adam

5. Hi Adam, As always, your presentation is excellent and helpful. On the S&P could there be a inverted head & shoulders forming.

   Kind regards David Milburn

   1. David,

      Thank you for your kind words and for commenting on our blog. I think it is too early to predict if the market is making an inverted head and shoulders formation. I do think that we are going to see a move back down and a possible retest of the recent lows.

      Our long-term indicator (monthly trade triangles) is still pointed lower for this market. I prefer to let the market tell me what it wants to do and right now it is still in a longer-term bear market.

      All the best,
      Adam

6. Hi Adam,
   Do you use the same concept to trade ES.M09? i.e., Monthly for trend and weekly for timing? Or you use the weekly for trend and daily for timing?
   Ali

   1. Ali,

      That's a very good question. The ES.M09 is a futures contract and as such we would trade it using the weekly trade triangles for the trend, and the daily trade triangles for timing.

      However, if you wanted to be conservative it would not be a bad idea to utilize the monthly trade triangles to get a better feel of the major trend. That is what we use in the indexes.

      I hope this answers your question ... every success in the future. Thank you for using MarketClub.

      Adam

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