Monday, May 20, 2013

SPX Pattern Inversion

We have looked at pattern inversion before as a method for obtaining clues about when a rally is topping. In the post linked above, we saw that there is often symmetry in the characteristics of the rally from its low to its high (in this case the gold rally from 2008 to 2011), as if you could rotate the chart about a middle pivot point. I made the mistake in that post of assuming that the symmetry would continue beyond the 2011 high, which did not happen. In other words, the pivot point identified in that post was good only for the rally that ended in 2011.

Here is an example using SPX. This shows the rally from 2002 to 2007. In the top image I visually picked out the bumps and numbered them. Then in the bottom image, which is simply an upside-down rotation of the top image, I matched up the bumps roughly in time and price. It is a pretty good match.


Now let's look at our current rally from 2009.

No matter how I number the bottom image, it does not come out nicely and falls apart after the 4th or 5th bump. But what if this current rally is not the final rally, and bump 1 in the upside-down image hasn't happened yet? Then it would look something like this:

This works much better. For this reason, I do not believe that the current rally will mark the final top, but instead there should be one more correction and a higher high in a few months, likely coinciding with the July/August Jupiter-Mars conjunctions.

Furthermore, readers Buffy and Rotrot have recently pointed out something I missed in Cowan's book, which is that the 2013 Jupiter-Mars conjunction interacts with the Beast cycle. Since all interactions with the Beast cycle are important this gives further validation that July/August could mark the final top.

5/26/2013 Addendum


Provided by reader Chris:

Hi Platy.

Attached are my charts I used for my response. The color codes for the moons in the third chart are:

New = Blue;
1/4 = Brown;
Full = Blue;
3/4 = Green

Happy to redo the charts again if necessary.

The charts were made using MarketWarrior.

Also below is a link to free weekly articles utilising Gann. I really recommend the site to your readers.
Cheers
Chris





5/31/2013 Addendum

As per Jay's analysis in the comments below, this chart shows the planetary price of the May 22 SPX high (1687) 180° opposite the heliocentric Jupiter/Mars midpoint (at 67° from 0° Aries).
 
The August 17, 2013 Jupiter-Mars conjunction will occur at 3.5° Cancer, or 93.5°, when we expect a major turn. If we apply the same method to estimate planetary price, the price 180° opposite the conjunction is 1713.5. But since multiples of 90° are important, the resulting price could instead be $90 higher (or lower), or 1803.5 (or 1623.5), etc.

90 comments:

  1. Platy, This fits nicely with some of my charts:) Here is one of them, the longest I have out to Sept, but this is my #1

    https://dl.dropboxusercontent.com/u/31723500/%231%20T%20Chart%208%20May%202013.jpg

    Not mine - https://dl.dropboxusercontent.com/u/31723500/SPX%20L%20T%20Cycle%2012%20Feb%202013.jpg

    Chris

    ReplyDelete
  2. take a look at your favorite indicators on the NDX 2 hour chart...some indicators are in the tank, yet price stays afloat...interesting...

    http://tinyurl.com/nz5f7az

    rotrot

    ReplyDelete
    Replies
    1. NDX...swing trade signal just occurred...

      rotrot

      Delete
    2. Hi Rotrot,

      Is it possible for you to put up a chart?

      Great to see you posting on this Blog :))

      Chris

      Delete
    3. swing trader is extremely sensitive...the signaled reversed during the day...however, that was the first sign of weakness since the April low...at changes of trend the signal often whipsaws...

      rotrot

      Delete
    4. Thanks for the comments Rotrot.

      Chris

      Delete
    5. swing trader - extremely sensitive, early warning signal
      daily trader - multiple days or weeks
      trend trader - multiple weeks or months

      "...swing trade signal...at changes of trend the signal often whipsaws..."

      NDX...swing trader has signaled a sell...NDX daily trader has not signaled a sell (not as sensitive as swing trader)...however, RUT daily trader has signaled a sell ...last RUT daily trader signal was at the April low...good luck with your trading...

      rotrot

      Delete
  3. Yesterday looked like a strong reversal day to me, especially Ag. Aussie gold stocks up strongly today on big volume and bought early. Still underinvested but am going to buy more on signs of strength.

    Will sell on a weak technical rise if that occurs. Next few days should be interesting but US gold shares outperformed yesyerday too.

    May not be the final lows but could be a very tradeable countertrend rally underway.


    Cheers

    ReplyDelete
  4. I also expect a major top around these dates. Actually my favorite candidate for a top was around March 29, but that one did not work out. In July there will be several planets in Cancer (Cardinal sign), a condition that is missing on my possible turning date of August 21. But the chart of August 24 looks very impressive as there will be both a triangle and square formation between several planets.

    ReplyDelete
  5. Hi, platy,

    That is why I asked you some time ago about the Jupiter-Mars Cycle, that occurs in ago´13 (17 ago´13?). It is possible we see a top here- drop about 10% typical in tops process in the Dow Jones in the end of may-beg. june´13, and in summer could see a new top, or a double top? or a marginal highs? my target is 16.000 in the Dow Jones or a litle more in a big megaphone from 2000-07-13? in logarithmic scale.


    Thanks, platy and all of you that collaborate so well and make this blog so
    outstanding.

    Apanalis

    ReplyDelete
  6. On the other hand, Jay, how can you manage this possible scenario with your pattern?

    Thanks in advance.

    Apanalis

    ReplyDelete
  7. The problem we all have is knowing for certain the actual start date for cycles.
    I've run cycles from the March 2009 low based on Cowan's cycles in 4-D. 4 cycles used:
    2 converge 31st May, 1 cycle 4th August, 1 cycle 27th Sept and 2 cycles 20-23 Dec.
    These are the cycles he used to build the composite index of the Dow in the 80's.

    ReplyDelete
    Replies
    1. That's the difficulty of using cycles.

      Delete
    2. That is the most difficult part, figure out where to start.

      I was actually looking for the top on May 29th.

      Delete
    3. Agree - the trouble is the more lines on your chart the chances are one will hit whether or not it is correct or not!

      Delete
    4. Nut saying that Cowans cycles from 4-D are usually pretty close until the dreaded Phase shift occurs and throws everything out

      Delete
    5. Actually, starting point and which cycles (or combination thereof) to use are the two most difficult questions.

      Delete
  8. Both the 2000 and 2007 highs had a double top before the main pull back commenced. The time taken for the 2000 double top was 24 weeks. The 2007 was 13 (half approximately). Thirteen weeks from now takes us to 28 August. I still contend the mid-term low will come in during June.

    ReplyDelete
    Replies
    1. Chris, This would fit with that idea - https://dl.dropboxusercontent.com/u/31723500/XJO%20RED%20Cycle%207%20May%202013.jpg

      Note this is the Aussie XJO, but fits on SPX

      CHris

      Delete
    2. could it be nearly half that again say 7 weeks this time? could fall on the 10th july?

      The snp 500 went down maybe covering shorts?
      by RB

      Delete
  9. it takes quite some time to access this website, comments etc.,
    any thoughts on why this is happening. Other websites are ok for me.
    thanks.

    ReplyDelete
  10. Hi Crissoff

    Are you in Oz as well?

    ReplyDelete
    Replies
    1. Across the ditch. TW - crisstoff1

      Chris

      Delete
    2. The Web site access is fast when you are on Windows but very slow if you are Linux. I am in USA and don't have this kind of problem with other Web sites.

      Delete
  11. ...have been on a quest to further enhance my trend trader (signals for multiple weeks or months) system...have come up with a radically different approach...back tested the trend trader going back many years...since the October 2007 top, the trend trader has signaled 24 changes in trend for the SPX...also tracking INDU, NDX and RUT...the trend trader is approaching the next change in trend signal...also utilize swing trader (extremely sensitive early warning system) and daily trader (signals for multiple days or weeks)...good luck with your trading...

    Thursday, May 23, 2013 09:45AM

    swing trader - SPX, INDU, NDX, RUT down

    daily trader - SPX, INDU, NDX, RUT down

    trend trader - SPX, INDU, NDX, RUT up

    rotrot

    ReplyDelete
    Replies
    1. dear mr. rotrot,
      in your message you say trend trader up in all indices
      do you see any significant correction in this exuberant market as there is plenty of paper money floating around and even FED may be buying everything in their coffers
      vick

      Delete
    2. Vick.. I think the key to his sentiments is to pick one of them as your MAIN trend.. and trade all the markets momentum based on that TREND you are following.. However short or long it takes.

      Delete
    3. Thanks rotrot.

      I tried again with wordpress. These are the steps I followed.

      1. I use chrome browser.
      2. Open a tab, platy's blog.
      3. Open a new tab; log in to wordpress.com using credentials.
      4. Come back to Platys' blog, entered new comment, "Reply as" with my wordpress name.
      5. publish.

      Delete
    4. It also gave me OpenID error. What I did was: go back to wordpress tab. Click my dashboard.

      Came back to Platy blog, clicked "Reply as" to google account. Then again changed to "wordpress", entered my id "magnetpal" again. It posted my comment this time!!!

      Crappy and strange but it worked!!

      Delete
  12. Hi.

    Wednesday's high in the S&P touched both Saturn and Neptune (exactly for Neptune). Interestingly, the Neptune line is the same Neptune line that saw the end of the 2007 rally. And the 2009 low was at Neptune 1440 degrees removed. Also, since 2009, each pull back has generally followed Saturn retrograde. Saturn is currently retrograde and turns direct in early July. On this basis a pull back is imminent.

    I would expect the North Node will determine the ultimate high at a little under 1690-1700. This seems to be confirmed by the mean line of the 5 outer planets plus the north mode.

    ReplyDelete
    Replies
    1. Hi Chris,

      That sounds like Gann analysis. Can you illustrate by posting a link to a chart?

      Delete
    2. Hi Jay,

      I did a chart of the north node based on Cowans work and the link was made on the 17th of May. As of today we have reached that upper resistance line.

      MP

      Delete
    3. Sorry forgot the link..

      http://tfaat.blogspot.ca/2013/05/ganns-price-by-degree.html

      Delete
  13. Hi Platy, if I haven' t understood wrong, Cowan's reversal point was on May 21st........right ? It seems he was wrong just by one day which is a great result if one thinks the forecast was made four years back. What does he predict for the rest of 2013 ? Do I need to buy the book ? Where ? Thanks

    A.G.

    ReplyDelete
    Replies
    1. Hi A.G.,

      Cowan lists several possible dates for the Beast cycle. I posted May 21 as the most likely, and we don't know for sure yet if that is only 1 day off. (If the rally continues I would look at May 28-30 next as discussed here.) The next big event for 2013 will be the Jupiter/Mars conjunctions in July/August. I highly recommend buying the book. You can get it here.

      Delete
    2. http://www.cycle-trader.com/

      "JUST RELEASED!
      CycleTimer 2 - Intraday
      Upgrade Now For Only $300

      CycleTimer 2 owners: Contact us with your full name and email address to receive your copy of Mr. Cowan's 2013 and Beyond Market Forecast. This 8-page newsletter is only available to CycleTimer 2 owners and shows what to expect in the stock market in 2013 and beyond. And more importantly, WHEN to expect it. By requesting your copy you agree to not distribute it or disclose its contents to anyone."

      rotrot

      Delete
    3. Are any of you getting CycleTimer 2 Intraday?
      It seems that trying to time intraday is excessive.
      It's hard enough trying to pick which cycle dates are turns (and whether it's a high or low) on a daily, weekly, or monthly time frame based on starting points and picking which cycles or combination of starting points and cycles to use. I remember many years ago buying what I thought was a cycle low when the stock market crashed almost instantly after I bought in. Or imagine trying to short the recent stock rally near end of April that far near extended on the upside compared to any other rally in a secular bear market. Ouch.

      Delete
  14. Hi Jay.

    I don't know how, or where to attach or post any charts here. I can post my email address and you can respond and I can attach my charts. That, however, leaves everyone else in the dark. Any pointers as to how to post a chart welcomed?

    ReplyDelete
    Replies
    1. Hi Chris, you can upload it to a photo sharing site like photobucket or imgur and get a link from there.

      Delete
    2. Sorry Platy
      RB

      Delete
    3. Or if you have a gmail account, you can use Google Drive. Dropbox works too.

      Delete
  15. Could you send it to platy maybe ? could she post it for you maybe ?
    RB

    Just read universal clock great read. Thanks for listing it.

    ReplyDelete
  16. Thanks. I will upload some charts tomorrow.

    ReplyDelete
  17. I made a txt document however, Imgur does not support this file.

    Platy, maybe I can attach it to you and you can post?

    ReplyDelete
    Replies
    1. Added as an addendum. Thanks Chris!

      Delete
  18. I have been looking at other markets and I can't help but feel that some markets may have 2 pentagrams at work simultaneously. Does anyone have any thoughts on this?

    ReplyDelete
    Replies
    1. Hi Yoda, Yes I think the general markets are affected by both the Nasdaq and S&P pentagram, and we are testing the DOW pentagram as well. What are you seeing?

      Delete
  19. Cattle seems to have two pentagrams. I think the natal position of the Sun is the basis for one pentagram and the other is the natural pentagram of 72,144...

    ReplyDelete
    Replies
    1. Thanks Yoda, what other markets have you analyzed?

      Delete
  20. I have spent a large part of my time the past couple of months pouring over the cattle market, the idea was first brought forth by a blog that I read where the author thought Gold reacted to 2 pentagrams anchored at 64 and 33 I believe

    ReplyDelete
  21. somewhere within the interaction section of the forex factory ,but I can't remember which date, I will try and search for it

    ReplyDelete
  22. pretty sure I saw Buffy's name in the blog and almondeyed

    ReplyDelete
  23. well the above was totally wrong here is the blog
    http://timecycles-timer.blogspot.com/2011_05_01_archive.html

    ReplyDelete
  24. For an article on heliocentric and sidereal trading for live cattle go to;

    http://www.fortucast.com/astr_cattle.aspx

    ReplyDelete
  25. I have been running some maths from the various highs and lows from 10/4/11 to 5/22/13 and have found some interesting relationships.

    The rally from the low on 10/4/11 to the high on 3/27/12 was 351 points and took 120 TD. The rally from 11/16/12 to 5/22/13 was 351 points and took 127 TD. 128 is also relevant in that the retracement from the high on 9/14/12 to low on 3/27/12 was 128 points. 1.618 (Fibonacci) times 128 points from that high (1468) gives 1675, just 10 points from the top.

    In addition, the 161.8 Fibonacci projection of the range of the rally from 10/4/11 and 10/27/11 gives 1646. And 261.8 from 6/4/12 to 7/5/12 gave 1665.

    And the range of the retracement from 3/27/12 to 6/4/12 by 1.618 from the top gives 1673.

    Price and time appears numerous times over the last few years.

    ReplyDelete
  26. Jays chart lining up perfectly ..............Thanks a million Jay and platy....gannman.....as above so below

    ReplyDelete
  27. can u post jay char

    ReplyDelete
  28. Anonymous II, yeah, I don't have the Jay chart either. Thanks!

    ReplyDelete
  29. Jay is my hero.
    He's the best I have ever met in my over 13 years of investing.
    He clearly get's the first price.
    I hope he will never ever leave this place.

    Then a long time - nothing at all.

    Then and Second comes another guy you don't know here. A few days earlier he mentioned: "sell everything, buy gold". That after several other extremely well calls over last couple of years.

    Third comes Cowan.
    The writings have long been on the wall.

    ----------------------------------------------------

    Special thanks goes to Platy - for providing this very unique place. As Jay is here - this is also the most important blog I follow - so Platy get's the gold medal for providing the best and most important blog in the www.

    ----------------------------------------------------

    Thanks also to all the other great souls here - sharing ideas, knowledge, time etc.

    ReplyDelete
  30. Agree with Goldhamster, Platy , thanks a lot for this amazing blog and all the best and smart people around... Just wondering any new posting? I check every 2 Hours to read your new post. :) :) :) HM2535

    ReplyDelete
    Replies
    1. Hi, sorry for the infrequent posts. I have been traveling and am way behind. I'll try to get something out in the next couple days.

      Delete
  31. A request to Platy,
    can we have links to Jay's updated charts on the right side of your blog, under "blog archive" Thanks

    ReplyDelete
  32. AG,
    what is the name of the second guy
    thanks.

    ReplyDelete
  33. Platy, are you/Jay still looking for more of a sell-off in Gold, or do you then it's bottomed. I know there's that time period coming to an end June 2, I think it is. Thanks for all the posts! I really appreciate this blog.

    ReplyDelete
    Replies
    1. Right the Golden Triangle that caused the bottom is ending June 2. The next turn date after that is June 7, Neptune turning retrograde, which should be pretty important. We also have gold and silver's Moon's nodes at major harmonics in June. I'll do a post on these things soon. I really don't know if the bottom is in, I can only take each of these turn dates as they come.

      Delete
    2. The drop in the US Dollar today is positive for gold. However, I am quite sure that this is just a bounce in gold and I expect vicious selling of gold once the bounce is complete.


      Delete
    3. Hi Jay, its interesting almost all analysts i read thinks gold will fall much further. i just wonder if everyone will be right?

      Delete
  34. You're the best Platy. Happy (and safe)trails to you!

    ReplyDelete
  35. Hey all,

    I was wondering if you guys could interpret the current market movements. Is the pullback before the final rise still gonna come?
    Thank you!
    Matt

    ReplyDelete
    Replies
    1. I am expecting a few weeks pullback before a final rise.

      Delete
    2. S&P has 36° Jupiter cycles in late June (Geocentric 6/23; Heliocentric 6/29). Maybe this will cause the reversal.

      Delete
  36. Guys,

    Here are Jay's charts.

    http://planetforecaster.blogspot.ca/2013/04/goldsilver-april-30may-2-ceres-cycles.html

    Search through the comments for his post with his links to the charts. (Jay, thank you for posting them for all of us!)

    Also, you can use Platy's search function at the top of the page to find all of his posts.

    ReplyDelete
    Replies
    1. Thanks, i had old ones.

      Delete
  37. I was reading some Gann mumbo jumbo recently. He was apparently fond of taking the average of planetary longitudes and comparing them to a security's price. I thought I would try it with the recent S&P 500 index high of 1687.18 made on 5/22. Here are the calculations for 5/22/2013 16:45 GMT (midpoint of trading day):

    Mars Heliocentric = 48.19782829
    Jupiter Heliocentric = 86.13794041
    Average of Mars/Jupiter = 67.16788435 - this is the midpoint!

    Convert price to degrees:
    MOD(1687.18, 360) = 247.18

    Angle between price and Mars/Jupiter midpoint = 247.18 - 67.16788435 = 180.0121156

    Gann thought hard aspects (multiples of 90 degrees) were important.

    Voila! We have a match and the market has put in what looks at least like a short-term peak. It remains to be seen how deep a drop we get.

    I think it is also important to note that heliocentric Jupiter and Mars have played an important role since at least the low of March 2009 and Platy has written about it.


    ReplyDelete
    Replies
    1. Great stuff! Thanks Jay!

      Delete
    2. Here is similar analysis for DJIA which peaked on 5/22 at 15542.40.

      Convert price to degrees:
      MOD(15542.40, 360) = 62.40

      Jupiter Heliocentric = 85.9473
      Saturn Heliocentric = 218.7863
      Jupiter/Saturn Midpoint = 152.3668

      Angle between price and Jupiter/Saturn midpoint = 152.3668 - 62.40 = 89.9668 or almost 90!

      Delete
    3. Thanks Jay - I added a second addendum to this post to illustrate your point.

      Delete
  38. Well I said months ago, as did Jay I may add, that the 2nd or 3rd week of May would mark a truning point in gold, but especially GDX. We didnt reach my lower target(but that doesn't mean that it won't in serveral months time), but for now gold and gold shares are going higher.
    I bought gold shares on the reversal last week just above their lows and have added on weakness earlier this week. I have covered my AUD short and wait for higher highs to come in gold and gold shares in the nexr 2 months.
    The reversal in Au and Ag was clearly last week. Silver was a dead giveaway.
    Now GDX led the way down and is now leading the way back up. Higher highs, increasing volume in both AU and GDX on up days and GDX outperforming Gold 2:1.

    It doesn't get any clearer than this IMO.

    ReplyDelete
    Replies
    1. Forgot to add two important points...... 21 months and 89 weeks from the 2011 all-time high. The significance of the later can't be understated.

      Delete
  39. Quite interesting from Jay. Also looking at Nasdaq Composite index, the high on 22nd of May of 3532 gives MOD(3532,360)=292; then 292-67=225. 225 can be divided EXACTLY by 45. 225/45=5.

    Nate

    ReplyDelete

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