Weekly Chart for September 8, 2013

The only new development this week is that the recent low might mark the end of the Medium-level Beta pulse. If so, and if our contention that this chart remains bearish is correct, the Delta pulse up should fail to retrace back to the August 2 high.

After failing to retrace back to the high, the next bearish development would be to confirm that the August 2 high also marked the end of the green level Y pulse (and hence wave 5 in the trending impulse pattern from the November 2012 low) by having price fall back below the new Beta pulse low at 1627.47. A close below the Beta-X trendline (shown in blue) would provide further confirmation that the rally from the November 2012 low is complete.

Finally, note that the June 2013 low must still be broken in order to show the TD D-Wave Triple Three count (presented in the recent series of postings on waves) as complete. Please note that the wave count shown on the chart is not that D-Wave count but instead one based heavily on my price pulse work. I use the D-Wave count in a corroborating role.

Weekly Chart Remains Bearish

This chart remains bearish. Here was the three step process that culminated in a bearish rating:

1) A TD Sequential countdown bar #13 on August 2,

2) The cash S&P500 had bearish divergence confirmed between price and the RSI (top pane) on August 9, and

3) A price flip occurred on August 16.

The associated “stop loss” (or risk) level is at 1737.48 (horizontal cyan line).

On this chart, the next bearish development would be to confirm that the August 2 high also marked the end of the green level Y pulse (and hence wave 5 in the trending impulse pattern from the November 2012 low). Currently it would take a move below the June 2013 low to get that confirmation. However; an “early warning” signal for this event would be a close below the Beta-X trendline shown in blue.

Finally, note that the June 2013 low must still be broken in order to show the TD D-Wave Triple Three count (presented in the recent series of postings on waves) as complete. Please note that the wave count shown on the chart is not that D-Wave count but instead one based heavily on my price pulse work. I use the D-Wave count in a corroborating role.

Weekly Chart Turns Bearish

This chart is now bearish. After recording a TD Sequential countdown bar #13 on August 2, the cash S&P500 had bearish divergence between price and the RSI (shown in the last weekly chart posting). With the stage set, we had a price flip to trigger a “sell” signal this week. The associated “stop loss” (or risk) level is 1737.48 (horizontal cyan line).

I believe we have now completed an Alpha pulse (at the blue color level). On this chart, an even more bearish development would be the confirmation that the August 2 high also marked the green level Y pulse (and hence wave 5 in the trending impulse pattern from the November 2012 low). Currently it would take a move below the June 2013 low to get that confirmation. An “early warning” signal for this event would be a close below the Beta-X trendline shown in blue.

Finally, note that the June 2013 low must still be broken in order to show the TD D-Wave Triple Three count (presented in the recent series of wave postings) as complete. Please note that the wave count shown on the chart is not that D-Wave count but instead one based heavily on my price pulse work. I use the D-Wave count in a corroborating role.

With both the daily chart and weekly charts bearish, one should entertain a sharply reduced exposure to equities.

Weekly Chart Just Needs a Price Flip

The technicals associated with this chart continue to be supportive of potential price exhaustion since we now have an actual bearish divergence between price and the RSI (top pane). This is particularly of interest since we have a TD Sequential countdown bar #13 in place. Now I am waiting for a price flip to trigger a “sell” signal. In this case a close next week below 1692.09 will do the trick. To be balanced we should also point out the associated “stop loss” level of 1737.48.

The Beta-X trendline is shown in blue. This is used as an aggressive “sell” trigger in the price pulse investing scheme. I believe we are very close to completing an Alpha pulse (at the blue color level). If so, the conservative “sell” signal would be for a close below the previous Z pulse low. This is also the low that must be broken for TD D-Wave to show the Triple Three count presented in the recent series of postings as complete. Please note that the count shown on the chart is not that D-Wave count but instead is based heavily on my price pulse work.

With the daily chart now bearish, the weekly close to flipping that way, and potential exhaustion showing up at the monthly levels one should be ready to move even further to the sidelines as far as the cash S&P500 goes.

Weekly Chart Showing Potential Price Exhaustion

Again the focus is on the potential for price exhaustion; especially now that a TD Sequential countdown bar #13 has printed. I use this event in a conservative fashion – waiting for a price flip to trigger a “sell” signal. In this case a close next week below 1680.19 will do the trick. To be balanced we should also point out the associated “stop loss” level of 1737.48. 

The technicals associated with this chart continue to be supportive of potential price exhaustion. Note that even though price is now at its highest closing level, both the RSI (top pane) and Composite Index (not shown) are not confirming. Of course, a continued rally may work off these potential bearish divergences. 

The Elliott Wave count shown is not the TD D-Wave count presented in the recent series of postings. The count shown is based heavily on my price pulse work and you can see two levels of pulses. The bottom line is that we are near the end of a trending impulse pattern from November 2012. Thus we again see potential price exhaustion. Recall that the D-Wave is also indicating pattern completion.

Lastly the Beta-X trendline is shown in blue. This is used as an aggressive “sell” trigger in the price pulse investing scheme. Of equal import is the fact that the rally from the June 2013 low is a Y-pulse which must be followed by a Z-pulse. Oftentimes the most punishing declines are associated with Z pulses. 

With potential exhaustion now showing up at the daily, weekly and monthly levels one should be ready to move to the sidelines nimbly if the sell triggers start to fire.