Unconfirmed Uptrend According to Dow Theory | Stephen Suttmeier

The current position of Dow Theory is an unconfirmed uptrend, or bull market, with new highs for the Industrials (DJIA) and a lack of new highs for the Transports (DJT). 

Until the Transports confirm the highs on the Industrials, this bearish non-confirmation signal for Dow Theory is a market risk.

Stephen Suttmeier — October 17, 2024.

S&P 500 Weekly High Expected October 21-22 | Robert Miner

E-mini S&P 500 weekly high probable by next week, ideally around October 21-22 (Mon-Tue). Followed by a 2-3 week correction. And Election Year Fall to Year End net bullish trend.

Robert Miner — October 16, 2024. 

 

On Monday, October 14, the net percentage of S&P 500 members hitting 52-week highs reached the highest level (22%) since March. Forward returns for the S&P 500 have consistently been positive after strong readings in net new highs.

 

 Bespoke — October 16, 2024.

S&P 500 Cup-and-Handle Breakout Targets 5,930 & 6,180 | Stephen Suttmeier

The S&P 500 has experienced a bullish breakout from a cup-and-handle formation that formed between July and September, indicating potential upside targets of 5,930 and 6,180. 

Seasonal trends for the fourth quarter further support these targets. Last week’s tactical breakout appears strong, with support near the 5,775-5,745 range. Importantly, the cup-and-handle pattern remains intact as long as the S&P 500 stays above the 5,600s.

Stephen Suttmeier — October 15, 2024.  

S&P 500 Uptrend May Extend to 5,800 Into Equinox | Robert Miner

Daily S&P 500 data from the July high shows an an A-B-C correction into August 13. Since then, the S&P 500 has continued upward and sideways, reaching a new high last Friday, August 30. With daily momentum showing a bull reversal, the S&P 500 is expected to remain bullish for the next few days and likely exceed the July high within the next week or two. The daily closing level of 5,798 is a key benchmark to watch.

 

 

Key dates to monitor include the week ending September 20, which aligns with the next Fed announcement and the fall equinox on September 22. Historically, reversals often occur near the fall equinox. If the S&P 500 remains sideways or rises into this period, it could signal the completion of the current upward trend and the onset of a counter-trend move.

 

For the next three weeks, the S&P 500 should target the range of 5,689 to 5,783 based on weekly closing data. Monitoring this range is essential. A weekly close within this range by the week ending September 20 may indicate a potential weekly high. Weekly momentum indicators suggest that the S&P 500 is likely to continue its upward trend for another two to three weeks.

 

Reference:
Robert Miner (August 31, 2024) - S&P 500, Gold and Bitcoin Updates. (video)

 

See also:

Robert Miner (April 26, 2024) - The S&P 500 and the Election Year Cycle.

Re-Accumulation & Re-Distribution Range Patterns | Richard D. Wyckoff

 S&P 500 E-mini Futures (daily bars - May 23-August 30, 2024) — 40 Week Hurst Cycle Trough on August 5th.

S&P 500 E-mini Futures (4 hour bars - August 15-30, 2024) — Distribution or Re-Accumulation:

Distribution Schematic #3 in Phase C or Re-Accumulation with Spring Action in Phase D ?

 

   The 4 Phases of Richard D. Wyckoff's Market Cycle:

(1.) Accumulation, (2.) Mark Up, (3.) Distribution, (4.) Mark Down.

The Re-Accumulation process is exactly identical to the Accumulation process. The only difference between the two is the way the structure begins to develop. While the Accumulation range begins by stopping a bearish movement, the Re-Accumulation range begins after the stop of an upward movement. To put it another way: A Re-Accumulation occurs during a longer-term up trend, which will continue in the future. The main street is finally on the right side as well. Inside a Wyckoff Re-Accumulation schematic, buyers are closing parts of their long positions and sellers are joining the market. With the incoming selling positions, market makers can fill new long positions again.

 4 Types of Re-Accumulation Ranges a.k.a. Continuation Patterns a.k.a. Trend Continuation:

(1.) Re-Accumulation after a Decline.
(2.) Re-Accumulation with Spring Action.
(3.) Re-Accumulation after a Shakeout.
(4.) Re-Accumulation with an Uprising Structure.

The 4 Re-Distribution types are simply the opposite (lower 4 schematics):

(1.) Re-Distribution after a Rally.
(2.) Re-Distribution with Spring Action.
(3.) Re-Distribution after a Shakeout.
(4.) Re-Distribution with a Declining Structure.

 Examples of different types of Re-Accumulation Patterns in the Apple (AAPL) Weekly Chart.

 

The events and phases are still the same (see the Accumulation and Distributions Schematics - the last 4 charts). Only the beginning of the Re-Accumulation cycle is different and equals the start of a distribution cycle. Take a look at the Wyckoff distribution schematics below for the occurring events. The main events that differ from an accumulation or distribution cycle are the occurrences of the Creek. The Creek is a small trend over time and can equal a smaller consolidation. The Creek builds liquidity on both sides of the market and misleads market participants. The Jump Across the Creek (JAC) is the event that causes the SoS. The Jump Across the Creek does take out previous resistance lines with a strong up move. The Jump Across the Creek can also occur inside the trading range of the accumulation. The Creek can be the horizontal resistance defined by Phases A and B or an internal trend line that formed inside Phase B.

• After the spring and test events, there is a bullish price move with momentum. This is called the Jump Across the Creek. Price continues with a bullish Phase E.
• Usually, any shakeout and/or decline action before Re-Accumulation will have a local smaller distribution pattern (cause and effect).
• The Initial Shakeout/Decline is less pronounced during Re-Accumulation than before Accumulation.
• Volume: Re-Accumulation usually has less supply than Accumulation.
• The maximum swing of trading range (highest to lowest point): Re-Accumulation trading range is usually tighter compared with an Accumulation trading range.

 (1.) Re-Accumulation after a Decline

 

• Weakest among the Re-Accumulation types.
• Decline usually starts from a small local distribution pattern.
• It can have different variations of the trading range (see the structure of the next 3 formations).

(2.) Re-Accumulation with Spring Action

 

• Flat or sloping down formation.
• It can potentially have a few lower lows with a spring being the lowest point of the trading range.
• Leading stocks can exhibit short-term weakness after strength in this formation.

(3.) Re-Accumulation after a Shakeout

 

• Absorption of supply happens in the trading range without violation of support.
• Usually and depending on a position of the market, this pattern exhibits strength.

(4.) Re-Accumulation with an Uprising Structure 

 

• Re-Accumulation with an Uprise is the strongest Re-Accumulation type.
• This structure will exhibit higher highs / higher lows.
• Sometimes can be confused with a topping trading range (Distribution).

 

 

 Accumulation Schematic #1: Phases A and B.

 Accumulation Schematic #1: Phases C, D and E.

 

 Distribution Schematic #3: Phases A, B, C, D and E = the Inversion of the  Accumulation Schematic #1

 

The Re-Distribution occurs inside a markdown cycle and stops a down-trend for a longer period. After bigger price moves even Main Street joins the trend. Now it is time for the market makers to bring the price into a consolidation phase to scare sellers and bring in new buyers. That ensures new liquidity for the institution’s to place new short orders. The start of a Wyckoff Re-Distribution schematic is the same as an Accumulation cycle. A Creek inside the trading range creates liquidity on both sides of the market, which gets taken by a UTAD. Many people will see this as a break-out to join bullish price action, but don’t get fooled. With a Jump across the Creek, the price is not only returning into the trading range but going to continue the downtrend from before.

 

 

  Distribution Schematic #2: Phases A and B.

 

 Distribution Schematic #2: Phases C, D and E.

 

Many believe that simply labeling the events is sufficient for detecting Wyckoff cycles. Don't forget that a supposed Distribution can become a Re-Accumulation or an Accumulation a Re-Distribution. Therefore, it is essential to presuppose a fundamental market analysis and confirm a Wyckoff cycle with COT data, Seasonality, or other longer-term confirmations. Don't make the mistake of looking for Accumulations and Distributions in lower time frames. It is easy to draw a supposed accumulation on a 5-minute chart, but a real Accumulation takes place in higher time frames. Since a Wyckoff cycle takes time to unfold, wait for the events to occur and be fully validated. Otherwise, one quickly get s distracted by the noise within the actual moves and makes bad trading decisions in the worst case. 

 

Bruce Fraser (January 30, 2020) - Distribution or Re-Accumulation? 

Reference:

Richard D. Wyckoff (December 21, 2022) - Accumulation & Distribution Schematics.

Jim Forte (1994) - Anatomy of a Trading Range.
Hank Pruden & Max Lichtenstein (2006) - Wyckoff Schematics - Visual Templates for Market Timing Decisions.

WyckoffAnalytics.com (2022) - Richard D. Wyckoff - His Method and Story.

Matt LeTrader (2022) - Composite Man: A Journey through the Trading Range. 

Roman Bogomazov (2022) - Wyckoff Method Trading and Education.

Precious Metals Setting Up for a False Move? | Martin Armstrong

When we look at precious metals, one would expect this is the long-awaited breakout for gold. Yet there is something amiss. The Yearly Array still points to a Turning Point here: 2024 with a Directional Change. That would imply that we may be looking at an important high come Monday if we reach at least 2673, or making highs after Monday may lead to the final high on August 28th, which may be more likely. The major resistance stands at the 2800 level. However, the initial target resistance for this coming week stands at 2573, 2589, 2695, and 2705.

 

Platinum is not following gold and implies it may yet test support into 2025 before a rally unfolds. Note that we have a Directional Change here in 2024 as well. However, it appears to be a low forming in 2025 and a shift to the upside thereafter.

 

 

When we turn to the Silver/Gold Ratio, we see a Double-Directional Change in 2024. The Stochastic is starting to turn down, implying that gold may decline, but silver will gain on the ratio. This is pointing to a more sustainable bull market in the years ahead [...]

 

Before a sustainable bull market exists, there is always the FALSE MOVE; in this case, it looks to be shaping up to the downside. This may present an important buying opportunity as we head into the election.

Quoted from:
Martin A. Armstrong (August 18, 20124) - The Metals Setting Up for a False Move? 

 

User Manual for Martin Armstrong's Socrates Platform, January 2019. 

Trading Major News Events | D'onte Goodridge

News events typically inject momentum into the market, often prompting traders to anticipate where price might trend in response to the news. Making educated predictions about these movements is a common strategy rooted in technical analysis. Position yourself AFTER major news releases (NFP, CPI, PPI, PMI, FOMC etc.) with either a Pump & Dump or a Dump & Pump trading setup.

Sell Scenario/Setup: Wait for the buy side liquidity pool on the 15 minute timeframe to be raided first. After that, go to the 1 minute timeframe entry above the killzone's opening price. Then, anticipate that price will revert back down to a sell side liquidity level.

 

 

Buy Scenario/Setup: Wait for the sell side liquidity pool on the 15 minute timeframe to be raided first. After that, go to the 1 minute timeframe entry below the killzone's opening price. Then, anticipate that price will revert back up to a buy side liquidity level.

 

When price moves above the opening price of a killzone, it's in a premium. This is where to find ideal sell entries. 

When price moves below the opening price of a killzone, it's in a discount. This is where to find ideal buy entries.

Reference:
D'onte Goodridge (July 14, 2024) - Trading News Events. (video)

 

 Major news July 15–19 (UTC -6).

My “New Reversal Day” Discovery | Larry Williams

The most common reversal day is simply one where prices sell off substantially, almost always down limit, only to reverse and close up for the day. Such a day appears in the following diagram [A + B].

 

A series of top and bottom reversals are also shown for your observation. Notice, in each case, how a temporary reaction against the main trend was ended when we had the “flush-out” day with prices selling off drastically, then recovering, to close up for the day. A reversal day is even more significant the longer the correction has been in effect.

 

MY NEW REVERSAL DAY DISCOVERY

Our second form of reversal day, and one I’ll bet you’ve never even heard about, starts with prices heading sharply lower and closing, sharply lower prices might end up limit down, or just “off sharply” but, in any event, prices take a beating and are down handsomely for the day [C].

» When prices should go lower, but don't, buy ! «

The trend reversal is indicated the next morning when prices open a good deal higher than the previous day's close. Such unusual strength is indicative of a key reversal for the market. What happens, in essence, is that prices fail to follow through with the previous day's slide. This type of action is most unusual since lower prices forecast lower openings about 85% of the time. Lower prices, with substantially higher openings, are a “sure thing” that a new move has begun.

It is particularly significant if prices close down the limit, and the next day open slightly up. Limit moves should beget more limit moves. A reversal of this pattern points to a market opportunity.

A special point of interest here is that an extremely strong signal is generated any time you have two reversal days with the second one higher, for a buy, lower for a sale. This is an unusual display of strength. I cannot recall when such a signal did not produce profits.

Quoted from:
Larry Williams (1979) - How I Made One Million Dollars Last Year Trading Commodities.

 

 

 "New Reversal Days" in the NQ — April-May 2024 (daily bars)

The 8 Most Common Chart Patterns & How to Trade Them | Aksel Kibar

I've simplified classical chart patterns to the most basic/common 8 patterns. I think most new patterns are derived from those basic ones. Our brains' pattern recognition is not that advanced to focus on so many derivatives. In fact better success can be achieved by narrowing down the below to select few.

 

 

There are 3 Types of Triangles: The symmetrical triangle, the ascending triangle and the descending triangle. Between those three I favor ascending and descending triangles for couple of reasons. One of them is, both ascending and descending triangles have horizontal boundaries. Breakouts through the horizontal boundaries are the chart pattern signal. The other reason is that, both ascending and descending triangles have directional bias due to their upward and downward sloping lower and upper boundaries. I find symmetrical triangles difficult to trade as price usually finds resistance at the minor highs following the breakout. Pause around minor resistance usually hampers the momentum and can result in more frequent failures. A symmetrical triangle has both boundaries converging towards an apex. It is a neutral chart pattern and doesn’t have a directional bias.

 

 » The Head and Shoulder Continuation (H&S Continuation) is one of my favorite chart pattern. «

 

There are 4 Types of Breakouts:

Type 1 Breakout = Breakout without any Re-Test/Pullback.
Type 2 Breakout = Breakout with a Re-Test/Pullback.
Type 3 Breakout = Breakout followed by hard Re-Test of Pattern Boundary.
Type 4 Breakout = Failed Breakout  - Price fails to continue in the breakout's direction and instead reverses. 

 

 

 

 

 

Breakout Type 1, Type 2, and Type 3 Summary.

 

 

 Head & Shoulder Top Failure acting as Bullish Continuation.

 

Cup & Handle as a Continuation Pattern in an Uptrend.

 

Rectangle as a Continuation Pattern in an Uptrend.

Symmetrical Triangle as a Continuation Pattern in an Uptrend.

 

Several Bullish Chart Patterns in an Uptrend.

Rectangle Bullish Reversal.

 

Rectangle Bullish Continuation.
 

The latest stats on pattern reliability: Rectangle continues to lead. With good risk management Type 1 & Type 2 breakouts offered edge with pattern signals.

 

 

Reference:

Aksel Kibar @ X

Aksel Kibar - YouTube Channel.

Aksel Kibar - Tech Charts Blog.
Richard Schabacker (1934) - Technical Analysis and Stock Market Profits.
Robert D. Edwards & John Magee (1948) - Technical Analysis of Stock Trends.
Peter L. Brandt & Bruce Babcock Jr. (1990) - Trading Commodity Futures with Classical Chart Patterns.

Peter L. Brandt (2011) - Diary of a Professional Commodity Trader: Lessons from 21 Weeks of Real Trading.

Stacey Burke (2015-2024) - Best Chart Patterns & Trading Setups for End-of-Day, Short-Term-, and Day-Trading. (videos)

 

 

 From Peter Brandt's foreword to the 2021 Harriman House re-edition of 

Richard Schabacker's 'Technical Analysis and Stock Market Profits'.

Does history make a case that Bitcoin has topped? | Peter L. Brandt

Judge for yourself. It’s called Exponential Decay — and it describes Bitcoin. I hate being the bearer of bad news, but data are data. The fact is that the bull market cycles in Bitcoin have lost a tremendous amount of thrust over the years. You may like the story of this data or not — but you will have to deal with it (or at least account for it, adjust for it or just plain ignore it). In fact, I don’t like the Exponential Decay occurring in Bitcoin — Bitcoin is one of my personal largest investment positions.

There have been four major bull cycles in Bitcoin, with the current advance the fifth major bull cycle [the advance from cycle low to cycle high shown in brackets].

    Dec 21, 2009 to Jun 6, 2011 [3,191X advance]
    Nov 14, 2011 to Nov 25, 2013 [572X advance]
    Aug 17, 2015 to Dec 18, 2017 [ 122X advance]
    Dec 10, 2018 to Nov 8, 2021 [ 22X advance]
    Nov 21, 2022 to xxx x,, yyyy [high so far is $73,835 registered on Mar 14, 2024]

Now, here is where Exponential Decay is showing its ugly head.

    The magnitude of the 2011-2013 was approx. 20% of the 2009-2011 cycle
    The magnitude of the 2015-2017 was approx. 20% of the 2011-2013 cycle
    The magnitude of the 2018-2021 was approx. 20% of the 2015-2017 cycle

Worded another way, 80% of the exponential energy of each successful bull market cycle has been lost. Applied forward, this would indicate that the current bull cycle will experience an an exponential advance of approximately 4.5X or so (80% of the 22X of the 2018-2021 cycle). Taking a low for the current cycle of $15,473 projects a high for this cycle of  $72,723 — guess what — a price that has already been reached.

Well, you will ask, what about the halving? Prices have exploded upwards after every previous halving. And that may happen again. But for now we need to deal with the fact of Exponential Decay. It has happened. It is real. You may not want to believe it, but I place a 25% chance that Bitcoin has already topped for this cycle.

If Bitcoin has topped, what’s next you might ask. Of course I have no clue. But, if Bitcoin has topped I would expect a decline back to the mid-$30s, or the 2021 lows. From a classical charting point of view, such a decline is the most bullish thing that could happen from a long-term view. If you want to see an example of such a chart structure, look at the Gold chart from August 2020 to March 2024.

Do I believe the analysis just presented? I don’t want to, but the data speak for itself.

Quoted from:
Peter L. Brandt (April 26, 2024) - Does history make a case that Bitcoin has topped?

 

 
See also:
Peter L. Brandt (March 9, 2024) - Bitcoin April 2024 Halving - Target 150K+ by October 2025.