Short Term Price Pulse 20 Jan 11

     Evidence is building that; 1) the entire move from the late November low is an undivided alpha pulse on the daily chart, and 2) that alpha pulse is now complete. The complication from the price pulse perspective is that a "sell" signal can not be generated right now on the daily price pulse chart unless we break the late November low. This means that the weekly chart may be the leading indicator rather than the daily chart.
     One method to watch the daily chart more closely is to see if we can close below the TD Reference close which is shown by the horizontal purple line at 1274.57.
     Let's see how the weekly bar ends up today. Remember that the trendline shown above is distorted because it is built on the weekly chart and these are daily bars. The intermediate price pulse beta - x trendline sits at 1272.97 - close to the daily TD reference close.

SPX Daily Chart - 19 Jan 11

     My last posting included remarks on possible ways to use the risk level associated with potential buy or sell signals. Today's daily chart shows why I prefer to use the more conservative method described yesterday.
    The sell setup reached on December 27 led to a brief cosolidation. Then, at the start of 2011, we had a TD Combo bar 13 print. The associated risk level (shown on the chart as the dashed horizontal cyan line) was calculated at that time as 1294.72. After a Combo 13 event the idea is to look for a reaction within 13 bars. This Tuesday, January 18, was the tenth bar and had a close above the risk level. Use of such a closing price to cancel the combo signal would halt any consideration of a short position (or closing of long positions). The close above the risk level was immediately followed by a strong downtrending day with a "price flip". Price flips after combo bar 13 are often used by traders as the actual "sell" signal. For myself, I like to wait for price pulse confirmation of the flip. On the daily chart that means a break of the January 11 low. I will show the daily price pulse tomorrow.
     Bottom Line: Both the weekly and daily charts are on TD Combo bar 13 situations but no action is warranted - yet. The daily chart is close to an action point; but requires price pulse confirmation.

SPX Weekly Chart - 18 Jan 11

As shown yesterday the intermediate beta-x trendline is being monitored for a possible break. As for the corresponding DeMark Chart ...
     After reaching a completed Sell Setup on November 5 there ensued a typical four price bar correction followed by a resumption of the uptrend. Right at the end of the year a TD Combo bar 13 was printed - a *possible* sell point. The cyan horizontal line at 1273.72 is the risk level associated with this sell point. How to use the risk level to cancel the pending Combo sell is up to each user. The aggressive way is to use a closing price above this level; and that has happened. A more conservative way (my personal preference) is to require a low to print above this point; this may occur this week. If it does we then wait for the next setup, sequential or combo signal to develop.
     Bottom line: Price action on a weekly basis continues in a bullish position.

Weekly Price Pulse - 15 Jan 11

     The cash SP500 is in an Intermediate degree Y pulse from the brief consolidation of late November. The uptrend from the July 2010 low can itself be viewed as a Medium degree alpha pulse. Whenever the y pulse has exceeded the previous delta pulse high in a trending market the beta-x trendline should be monitored; and you can see that we just bounced off that line.

     A valid break of the intermediate beta-x trendline would warn of a retracement towards the medium term beta-z trendline which currently sits at about 1090. The intermediate level price pulse analysis should be complemented with the weekly DeMark chart and I will show that tomorrow.