Natgas has had quite the move, since my buy call on monthly s1 at $4.44, a few weeks ago. Last week, natgas went up to the monthly R2 pivot(green line marked R2) @$5.85, the weekly 50 moving average(green line), filled an open gap(blue arrow) from last October and hit the 76.4% fib re-tracement. LOL Those confluences are resistance. Look for a pull back this week to maybe R1 / 50 dma(blue line) $5.33 - $5.50.
Gold last week, was capped by the monthly Pivot(yellow line marked P) at 1141, and support was 1100. Gold has now pulled back 10% from the highs earlier in the month. Gold is making a bullish harami pattern, but needs confirmation. The short term trend is still down(long term is still up), but that may change this week if gold can break above the 20dma at 1156. I think gold will trade between 1156 and 1050. If 1120 breaks we go to 1156.....if 1085 breaks we go to 1050.
Last week the indexes didn't make new highs on the new moon, but the Dow futures did. Also last week, the weekly R1 pivots where the highs and weekly S1 was support. The consolidation pattern continues! For the past 30 days, the best way to trade this sideways consolidation is to short Dow 10500, and cover at 10250-10300. Or buy 10250-10300 on pullbacks and sell 10500. That pattern will probably change soon. The 50 day moving average below(blue line) at 10175 and the monthly Pivot is the next support area. There are open gaps at 10450 and at 9978. That's the trading range I am looking for this week 10450 - 9978. Tuesday we have GDP and existing home sales.
Buyers showed up yesterday when CitiCorp (C) hit the monthly S4 pivot at $3.07(blue circle on the green line marked s4). Looks like a buy to me if $3.07 holds. I'm long at $3.12 with a $3.00 stop loss.
For the past several months, on the new moon, is the day the stock market would make new highs, each month. The December new moon is this Wednesday the 16th. This coming week is also quad expiration. I still think we'll trade between the Monthly r1 at 1125, and the monthly pivot point at 1072 this week. Things will get very interesting next week!
Gold has fallen almost 10% in 8 days. The 50 day moving average(blue line) is very close at 1104 on the Feb 2010 futures. I think gold will find support there this week, and bounce back up to the Mpp or 20 dma(yellow line). If not, watch 1093(Ws1) or 1085(MS1).
Natgas last week bounced off the monthly S1 pivot at $4.44(blue arrow) and today hit the monthly R1 pivot at $5.33(blue arrow). Thats almost a 25% move in 1 week. Pro traders use daily, weekly and monthly pivots for entry and exits. Just pick your time frame, you want to trade.
This past week, the S&P 500 tested 1120....the 50% retracement fib(mid), from the all time high in October 2007, to the March lows this year. The market has made back 50% of it's losses. I have been saying for a few months now, that I was looking for 1120-1136, for the 2009 highs. The yearly R1 pivot is at 1136. This is a major resistance area. Looking at the chart above, we have been going sideways since the November Bradley date. New highs have been sold, not bought, like last spring and summer. This is the new trend. Look for more of the same this week, as we consolidate more. Trading range 1070-1128.
AIG this year, has played off the yearly pivots(purple lines, and blue circles) to perfection. Why did buyers show up last March, when AIGwent down to the S2 pivot at 6.40? Why did sellers come out 2 times this past fall, and sell AIG right at the R1 pivot at 53.6? Is it possible that smart money / market makers are using Pivot Points? Or is it just a coincidence? If you think the latter, you should not be a trader!
Overnight, stock and futures markets around the world, sold off on the news, that Dubai will delay paying it's $59 billion in debt. The U.S. S&P futures market just closed for the Holiday, down almost 25 points (200 Dow pts.) or 2% from Wednesdays close. Most markets where down 3% in Europe and Asia overnight. While U.S. investors will be dinning on Turkey and visiting with family today, they have no idea that tomorrow morning, when the U.S. stock market opens, we are going to open down big! Black Friday this year, could be the beginning of a big crash.
Natural gas futures last week, found some buyers on the monthly S2 pivot(green line marked S2). Looks like we have a short term bottom in on natgas. I'm looking for $4.75 - $5.00 this week on December natty.
The past 3 months, the S&P has gone down 3%, the last week of the month. Will the pattern stay the same this holiday week? We have a lot of economic data this week, that could move the market either way. Last week the Dow and S&P could not close above their weekly R1 pivot points(white line marked R1 at 1108), and pulled back to the weekly pivot(blue line marked P) by Friday. This week I'm looking for the open gaps at 1108 and 1070, as support and resistance on the S&P 500.
Crude oil came down to the monthly pivot(yellow line marked P at $75.76) last friday and is bouncing off it. It was resistance there last summer, which now has turned into support. Watch the weekly Pivot at $77.54 for support this week and first resistance at wr1 @$79.51. Pivots are where pit traders look for entries and exits.
As I wrote last Sunday, watch for resistance on the S&P at the 500 dma(purple line on the chart). This week the S&P went up to the 500dma, and now is starting to pullback. The 500 dma is usually strong resistance or support, depending on where price is. I'm looking for a pullback to the 21dma(yellow on the chart) at 1071.
Crude oil ran into the 500 day moving average(purple line) at $82.50 last week. It's obvious that traders where taking profits there, since price could not close over the 500 dma. Look for crude oil to pull back and test old resistance at $75, which should be support now. Remember the 500dma, as the S&P and Dow Jones indexes are very close to theirs.
The S&P 500 rallied 3% last week, that started on the full moon. Short term reversals are very common during a full moon. Now the S&P 500 is testing the 20 day moving average(yellow line), and starting to make a right shoulder there, as seen on the chart above. This week we have the last major Bradley date of 2009. That coupled with the Head and Shoulders pattern that is developing, and major overhead resistance(1108-1136), we could see whipper price action the next few weeks. I would not be surprised to see the S&P drop 100 points very fast. Right shoulders tend to be very fast moves. This week I'm watching the 1074 to 1085 level as resistance, on the Head and Shoulders pattern. I think we will see a new sideways trend start to develop, as professional money managers are now fully hedged(the "Bonus Put" in this weeks Barron's). Volume on down days is bigger than on up days. Investor sentiment readings the last 3 weeks, is showing bullishness has peaked, for now.
We usually get a short term trend reversal around full moons, as I have opined before. I am looking for the market to be up this week, before we resume the downtrend into the next major Bradley date(11/9). I am looking for the markets to possibly go down to the new monthly S1 pivots in the next few weeks. S&P 1000
For the past 25 years, when the S&P 500 is trading above the 20 month moving average(yellow line), the stock market has been in a multi-year bull market. When the S&P 500 is trading below the 20 month moving average(yellow line), the stock market has been in a multi- year bear market. The chart above clearly shows this. The S&P just tested the 20 month, but could NOT close over it. We are still trading below the 20 month(yellow line), and the yellow line is pointing DOWN. We are still in a bear market!
This coming week, we should not see any Halloween ghosts or goblin's. With many Mutual Funds year end this week, money managers should keep the S&P 500 trading between 1065 and 1100. We are very close to major resistance on the Dow and S&P. First, we have the 500 day moving averages coming in at 10,325 on the Dow, and at 1120 on the S&P. Second, we have the 50% retracement fib(mid) from the 2007 high to the 2009 low, at 10,300 on the Dow, and at 1120 on the S&P. I'm hearing that many hedge funds are close to being fully hedged up here. In my opinion, this is NOT the time to be looking for NEW LONG POSITIONS. Look at protecting your profits!
Last friday, Microsoft gapped up at the opened and closed the day on it's low. As seen in the chart above, this happened on very heavy volume. This is a textbook example of a blow off top on Microsoft. The smart money that bought at $20, was selling to the dumb money(retail investors) $29.
The 2010 Bradley Model chart, is calling for a big massive move, in the spring and summer of 2010. Will it be a retest of this years lows? Or another rip roaring rally higher? We'll know the direction by the end of March 2010. Which ever direction it goes, it will be a big massive move. Bigger than this years move! Maybe the biggest in history!
The next Major Bradley date is 0n November 9th, 2009, and the new trend will stay in tact until the next Major Bradley date on March 1, 2010(see new post above). Since we have been in an up trend, since the last major Bradley date on July 15, 2009, I think we will start a sideways trend or down trend. The Model has an uncanny way predicting trend changes and chaos. ....just look at the chart above!
for more info on the Bradley Model, click this link.
The S&P 500 last week ran into resistance (sellers/profit taking) at the monthly R1 pivot. And came very close to filling an open gap from last October's melt down. My new target for this year is at the 50% Fibonacci, which is at 1120. December S&P futures Yearly R1 pivot is at 1136. I feel we'll see 1120- 1136 by December's Quad expiration. We still may see a fast pullback that will be bought. This coming week's trading range should be between 1065-1100.
The S&P 500 has run into major resistance at the yearly R1 pivot(purple line marked R1) at 1073/1074. And, it has made a Head and Shoulders pattern up there(see blue arrows at top of chart). Remember, back in early March, the S&P lows where at the yearly S1 pivot. It's normal to see a S1 to R1 move. We see it everyday with daily pivots(ie: see Euro trade post from 10/2).
This coming week, I'm looking for a bounce back up to 1040-1050 that should fail. In the next week or two, I'm looking for a hard fast fall down to monthly S1 at 1005 or monthly S2 at 954. The right shoulder failure, on a head and shoulders pattern, is usually very fast, because it traps the rookie traders. This selloff could setup up for a November - Xmas rally, and re- test the years high. Use a close above 1050 as your stop loss, if your short.
I have NOT heard anyone on CNBC or Bloomberg talk about this Head N Shoulders pattern, so maybe it will play out this time.
Gold kissed the yearly R2 pivot(purple line marked R2) a few weeks ago at 1026. In my opinion, that will be the high on gold for this year. Gold is now making a head and shoulders pattern(blue arrows), and I'm looking for a big pullback in price, and shake the grannies out. There is no Inflation, we still have Deflation going on. Gold always ends in tears... it has for thousands of years!
The Euro today, has gone from a low on the S1 pivot(blue circle, green line marked S1), to the high at the R1 pivot(blue circle, green line marked R1), for a 150 pip move. Professional day traders use Pivots as there entry and exits. Go long on S1 and sell 1/2 at the P, and the other half at R1. Buy fear and sell greed! Pivots are your best intraday set-ups to play.
Most traders have never heard of the 400 day moving average. It's one of my favorites, as it is the same as a monthly 20 moving average, on a monthly chart. The chart above shows the Dow kept testing the 400 dma(brown line) last month. Now it looks like were going to get a correction off the head and shoulders top. 9450 is the next major support area. The new monthly S1 pivot is at 9331 and the monthly R1 is at 9996.
The S&P 500 last week, pulled back to the 21 day moving average(yellow line), after testing the monthly R2 pivot(blue arrows and green line marked R2) at 1074. When the S&P hit the monthly R2 pivot last week, I knew there was an 85% chance that the index would not close above R2, and to look for a little pullback. With the end of month and end of quarter this week, we could rally back up to 1074, and make a right shoulder. If the S&P closes below 1040 this week, look for a fast fall down to the monthly pivot and 50 day moving average @1013. We get new monthly pivots on this Thursday, October 1. Monthly pivots will tell us where to look for support and resistance, for the month.
1. More of the same but worse. (2001 and 1981 where ugly down years)
2. Amidst far worse mood, the fundies actually bottom out as do prices, however people are so badly burned out by the doom & gloom few spot it & even fewer trust it - this is the actual market bottom in many assets real & financial often, amid a crisis. .(in 2002 and 1982 markets started to bottomed)
3. Quietly recovering still lots of distrust & very little feel good around. (in 2003, 1993 and 1983 where big up years, after bottoming the previous year)
4. Have things really been going UP for the past 1-2 yrs ? Quick buy something!( in 1984, 1994 and 2004 where consolidation years...the market went sideways before starting a new up trend)
5. Amid a modest dip & sometimes mild panic that turns into consolidation, gives way to the strongest up wave. ( 2005, 1995, 1985 =market was up)
6. Now things are really getting hot, prices are rising rapidly , the media is excited, etc. However, the astute observer sees that under the hood cracks are beginning to appear, tops are being built, etc. (in 2006, 1996 and 1986 where big up years)
7. The public thinks things are never going down again, but mid year, markets top out & towards the end. They give a violent warning of their wrath to come.( the 1987 crash, in 2007 the market topped )
8. Armageddon! ( markets went down big in 2008 and 1998. In 1988 it was a flat year, due to the '87 crash, a few months earlier)
9. Huge relief bounce that eventually rolls over, setting up for the disappointment of a long winter of years ending 0, 1 & 2.x. Media is excited, disaster has been averted, depression / recession, etc., is now over. Buy! Buy! Buy! Supposedly, this is the year that the markets / economy, etc., finally is coming back, etc., Or is it ? ( in 2009, 1999 and 1989 the stock market had a big up year)
For my Canadian friends: The Canadian Dollar(loonie) hit the yearly R1 pivot today(purple line R1). And the US dollar hit it's yearly S1 pivot today. Look for a pullback in the Loonie and a bounce up in the Dollar.
S&P has now entered the gap zone from last October (see blue arrow on chart). Typically the gap gets filled. But we are also at the monthly 20 moving average too(see earlier post on the 20 month moving average).
Natgas closed at $3.25 today........up 30% in 1 week, since my bottom call last week on the monthly S1 pivot. 1 natgas mini futures contract(QG) costs $1500 and pays $25 per penny move. If you would have bought 1 at Ms1, you would be up $2000.......... Pivots are a traders best tool! They tell us where the risk vs reward is the greatest, and when we are wrong, so we can take small losses.
Natural gas is trying to bottom on the monthly S1 pivot(green line marked S1 and blue arrow) after hitting 7 1/2 year lows this week. Natgas has fallen almost 50% in the past 30 days! Is today the bottom or just a dead cat bounce, as the saying goes? Picking bottoms is a very dangerous game! Monthly and yearly pivots can give a clue as where to look for possible bottoms and tops. UNG, the natgasETF, came within pennies of testing it's yearly s1 pivot(1st yearly support) this morning at $8.65. That's a possible clue that natgas may be close to bottoming. Bottoms and tops are usually a multi-week process.....not a 1 day event..........USE STOP LOSS ORDERS!
The NDX 100/QQQQ and NQ futures opened at the R1 pivot this morning, as seen on this 5min intraday chart, and came down to the S1 pivot for almost 20 points(see blue arrows). My favorite play is to short R1 on the open or buy S1 at the open(if price is there), for a quick trade. The best trades are in the morning from 8:30am est to 12:00 noon est., and then the market goes into chop for 2-3 hours. The last hour of the day, is when the professional money mangers come out to play.
The S&P 500 could not close over 1033 as per my post last week. We now have the pullback/correction I'v e been looking for. Is this the start of a big melt down like last year? Maybe, but probably not. I think we go down to the yearly pivot(yellow line marked P) at 975. The monthly s1 pivot could provide strong support at 986 too, but watch 975. We break that and then 950 is next support. 1013 is next resistance above and can be shorted with a 1018 stop loss.
Freddie Mac ran into the yearly pivot(yellow line marked P and blue arrow) last Friday, and today is starting to selling off. Smart traders used the yearly pivot to book profits and some traders went short there.
The S&P ran into the monthly R1 pivot(green line marked R1) this week at 1033 and cannot close over it. Now were getting a small sell off that should take us back down to 1000- 1005 and fill the open gap(blue arrow) there.
Traders in my trading room have been shorting the monthly r1 pivot.
Trading is a visual game. Buy support and sell resistance. In my 17 years as a trader, I've learned where support and resistance using a combination of MPG. I take Pivot Point analysis to a another level. Join my new Pivotalpivots.com Alert service. Follow me on Twitter @mpgtrader. Or click on the MPG Trading link below, and join myself and other MPG Traders live(during market hours).
1) Protect your capital 2) see rule #1 3) don't trade what you think, just trade what the charts say 4) use stops on all orders 5) never let a winner turn into a loser 6) never buy R2 7) never short S2 8) 3 losing trades in a row= strike 3.......shut down the computer for the day. Something is wrong in my head!
Investing and Trading involves significant financial risk and is not suitable for everyone. This blog should not be considered as financial or trading advice. All information is intended for Entertaiment Purposes Only.