The only way to make sure people you agree with can speak
is to support the rights of people you don't agree with.

--Eleanor Holmes Norton

UPDATED 20060818

COMMENT #293

CHART #592

1. A couple of months ago, we looked at the following CHART of weekly prices:

2. The discussion was how these key indexes provided insight into the top in the futures contracts in the complex a few months ago:

3. An example is shown in this CHART of yearly prices:

4. Today's CHART #592 updates daily prices.

5. The setting of the August high in this market below the pink horizontal trendline drawn off the July high on the date of the full moon is consistent with the action in the futures contracts.

6. The three red caps above price suggest a possible head-and-shoulders top.

7. The 100, 62 and 162 calendar day segments (100 X 1.000=100, 100 X 1/PHI=61.8 & 100 X PHI=161.8) are seen, by the green arrows at the top of the CHART, to be in PHI relationships.

8. The July high was set below the January high as noted by the pink horizontal dashed trendline.

9. At the bottom of the CHART, we can see how the approximate 21 trading day periodicity aligned at the last rep at the August high.

10. From the May high in the CHART, the light blue boxes show that the market declined 33 calendar days into the June low before setting the August high at the full moon 57 days later, 90 total (FIBONACCI #s=34, 55 & 89).

11. Price broke the lower ascending grey dashed pitchfork prong the last few days and then retested the line Wednesday before breaking to the downside.

12. We can see how the same happened with respect to the blue descending pitchfork line shown.

13. The play between these indexes and the markets in the complex can be quite important.

14. For example, the late 2004 high was signaled by the divergence between these indexes and the continuous spot futures CHART as shown in the following CHARTS of daily prices:

15. The high at this time was not exceeded for almost a year as prices traded sideways as seen here:

UPDATED 20060818

COMMENT #294

CHART #593

1. CHART #593 shows daily prices for the December contract:

2. The red WLC and MLC boxes (Weekly and Monthly Linear Time Cycle Index projected highs) suggest that the two highs shown in July and August are the turns projected by those boxes.

3. We can see how the initial surge to the July high was believed to have unfolded in the blue A-B-C movement shown (see pages 283-92 of "The $upertrader's Reference Manual").

4. The new high in August has necessitated reassessing the movement.

5. That reassessment is consistent with recent discussion and shows the entire 39 trading day rally shown (FIBONACCI #s 3 X 13=39) as having unfolded in the blue-boxed A-B-C rally presented.

6. The red lines below price show that the two highs have occurred after a 19 and 20 trading day segment and that the entirety of the action since the May high has seen an approximate 21 trading day segmentation (FIBONACCI #=21).

7. From the full moon high on 809, we can see in the CHART that the market declined 3 trading days and then rallied 2, 5 total (FIBONACCI #s=2, 3 & 5).

8. The market appears to have unfolded in the blue Wave 1 decline marked by the blue 1 in the CHART at the 814 low followed by the blue a-b-c rally to the blue Wave 2 high Wednesday.

9. This high has occurred at the Astro turning point projection listed on page 376 of "The 2006 $upertrader's Almanac - 2nd Half Edition".

10. This point is shown in the CHART at the down red arrow.

11. The up red arrow in July was the last such point.

12. Since the rally has occurred between the two points, the expectation is that the down red arrow at the most recent point will be of importance to this market.

13. The thick red trendline shows that price closed yesterday right on this ascending trendline support.

14. The blue ascending pitchfork shows that this price support level was also at the bottom prong of the blue pitchfork.

15. When we inspect price action since the full moon high, we can see that price yesterday just did break the pink horizontal trendline shown and triggered short sale entry via the trading technique presented on pages 205-9 of "The $upertrader's Reference Manual".

16. Today's CHART updates the following CHARTS and is consistent with declining expectations:

UPDATED 20060818

COMMENT #295

CHART #594

1. CHART #594 shows daily prices and further updates the following CHART:

2. We can see how the July and August highs both experienced non-confirmations at the July and August highs as marked in the CHART by the short red sloping trendlines (see pages 171-84 of "The $upertrader's Reference Manual").

3. These divergences occurred with price at the .618 price retracement level as marked in the CHART by the red horizontal dotted trendline (see pages 185-7 of "The $upertrader's Reference Manual").

4. The 613 low seen at the bottom of the CHART was the day of the release of the prior CHART and marked the low at the blue and green boxes shown.

5. Whereas the May tops were best marked by the indexes, the current tops best seem to be marked by the futures contracts (see prior COMMENT and CHART).

UPDATED 20060818

COMMENT #296

CHART #595

1. The May top was identified here:

2. From the top, the market began to break and was followed to the June low which was believed to have formed the blue Wave 1 low in the impulsive manner shown in the last CHART here (see pages 283-92 of "The $upertrader's Reference Manual").

3. We can see how the short red sloping trendlines identifying price / momentum oscillator divergences at the May high and June low were of only a few days (see pages 171-84 of "The $upertrader's Reference Manual"):

4. In the above CHART, it was not believed that the pattern was complete, but the pink think horizontal trendline did identify that the market was set up to provide short side entry via the trading technique presented on pages 205-9 of "The $upertrader's Reference Manual".

5. Here's the break thus suggesting that the 707 high, which occurred at the first Astro turning point listed on page 376 of "The 2006 $upertrader's Almanac - 2nd Half Edition", had set the blue Wave 2 high earlier than expected.

6. The black A-B were left as it was not yet clear that the blue Wave 1-2 sequence was complete since the blue Wave 2 high was very short of the time spent in the blue Wave 1 decline.

7. The next day, a large down gap was seen, and the thick pink horizontal line was included in the update to as a point price needed to break to confirm that the blue Wave 2 high had been set.

8. At the bottom of the CHART, we can see that net commercial short positions, though still negative, had not yet returned to the negative levels of May.

9. The down gap intraday low held and did not break the horizontal pink line and, a few days later, had rallied above the 707 high.

10. The time spent in the blue Wave 2 high thus now began to approach normal time retracement levels seen in the typical corrective move.

11. The blue a-b-c sequence thus seemed of value as price returned to the red upper up channel trendline shown in the CHART.

12. We can see how the blue WIC (Weekly Inversion Cycle Index) projected turn in the upper right corner of the CHART was exerting its effect on price and pulling price up into its projection.

13. It was thus allowed that the pattern shown was a bit early than the ideal WIC projected turn.

14. A few days later, the next price / momentum oscillator divergence occurred as price was repulsed at the .618 price retracement level.

15. That thick green lower upper channel trendline, first seen here …

16. … was included to show how it was supporting price.

17. A few days later, price was seen as having turned higher and to have negated the price / momentum oscillator divergence as the blue WIC projection was centered.

18. Price thereafter moved to a new high above the May high on fundamental news from Bahrain favorable to this market as can be seen in today's CHART #595 of daily prices for the continuous spot futures contract.

19. Although price was able to break out to a new high and close above the prior high for a few days as seen at the red horizontal dashed line, the breakout has since failed and the market has been unable to hold above the red dashed horizontal line drawn at the May high.

20. Meanwhile, we can see how the short green sloping line in the upper and lower boxes indicating the relationship between price and such momentum oscillators as RSI and Slow Stochastics has again turned red.

21. Since a similar very short red line can be seen at both the May high and June low, we certainly do want to pay attention to this price / momentum oscillator divergence.

22. One problem is that the short initial decline from the high has taken price down into the green WLC box and projected low (Weekly Linear Time Cycle Index) shown in the lower right corner.

23. The box also occurs the same week as a projected WIC turn (Weekly Inversion Cycle Index).

24. From the 717 low, the "best fit" from a pattern perspective would seem that the 721 high is a Wave 1 high and the 725 low a black Wave 2 low with the 808 high marking a black Wave 3 high.

25. From the 808 high, the market has declined in a 4-2=6 trading day sequence.

26. The 4 trading day sequence appears impulsive and to have defined the near term trend.

27. In the ideal world of the Linear Time Cycles and Inversion Cycle Index, we would see the market set a black Wave 4 low in the green and blue boxes shown and then rally for a few days to a new high amidst the red MLC projected high marked in the CHART by the red box in the upper right corner.

28. What is interesting is how negative the net commercial short position has become on the August breakout.

29. As can be seen by the black dashed line at the bottom of the CHART, the position is now more negative than at the May high.

30. For perspective, we can see that these levels are the most bearish since the highs seen a couple of years or so ago at the highs in the upper left corner of this CHART.

31. The breakout thus appears as a false-flag movement spurred on by fundamental news.

32. If all this is correct, this breakout should prove insightful to the rest of the complex.

33. If the breakout is a false one that has either ended its advance or will shortly do so amidst the red MLC box in the upper right corner, a downturn would align well with the other markets reviewed in today's COMMENTS and CHARTS and with the original presumption presented at the May high (see above CHART) but interrupted by the fundamental Bahrain news event.

UPDATED 20060818

COMMENT #297

CHART #596

(Post-close COMMENT)

1. CHART #596 shows weekly prices.

2. A minor change is made in the presentation of how the blue Wave 5 decline unfolded.

3. The 5 red numbers have been inserted.

4. The relationship of the three legs since the 2003 high of 47-59-52=158 in terms of those weeks that were advancing / declining is shown in the black text.

5. These figures show that the decline is in PHI proportions from the 2003 high to the low shown.

6. The blue pitchfork has been added and shows that price has again attained the upper blue descending prong.

7. At the bottom, we can see that the net commercial position has moved to new low levels as marked by the black horizontal dashed line.

8. The spread between the commercials (red line) and the large speculative interests (blue line) has also moved to historically negative levels for the period shown.

UPDATED 20060818

COMMENT #298

CHART #597

(Post-close COMMENT)

1. CHART #597 shows daily prices for the continuous spot futures prices through mid-morning today, Friday, 20060818.

2. Here we see all contracts presented making new highs for the move over the last day or two.

3. Perhaps a bit of a review will refresh the perspective in the complex.

4. These CHARTS of weekly prices were posted in June of last year and in "The 2005 $upertrader's Almanac - 2nd Half Edition".

5. The expectation in both was that price was about to move lower.

6. A year later found the following market at the bottom red descending channel trendline and at the blue and green boxes shown in the lower right corner.

7. The movement was seen as being comprised of two black A-B-C segments separated by the blue "X" wave at the 20050901 high in the middle top of the page.

8. The black Wave C decline from the 20060118 black Wave B high was seen as having already completed the blue Waves 1 through 4 (see pages 283-92 of "The $upertrader's Reference Manual").

9. The blue Wave 1 decline was about equal, in price, to the blue Wave 3 decline (see the red boxes).

10. From the blue Wave 4 high, the market was then believed to have been in the process of "extending" the blue Wave 5 decline.

11. The black Waves 1 through 4 (of blue Wave 5) were believed complete, as can be seen in the CHART.

12. But is was not quite clear that the movement had been completed.

13. In the bottom box, we can see how commercial interests had become very bullish on this market whereas large trend-following speculative interests had become very bearish.

14. These sentiments were reflected by the record widening of the spread between the two as represented by the red and black lines.

15. The middle box and short small red sloping line shows that such momentum oscillators as RSI and Slow Stochastics were diverging with the new price lows, thereby forming important price / momentum oscillator divergences (see pages 171-84 of "The $upertrader's Reference Manual").

16. This was an ideal time for the market to bottom.

17. At the same time, the following CHART of daily prices for the continuous spot futures contract showed that price had also moved down into the green and blue boxes in the lower right corner.

18. Here, too, an important bottom was suggested.

19. Weekly prices for the following two markets suggested that these markets might delay their bottoms until the end of June, however.

20. Expectations of a seasonal advance fit well with the following information posted at the time from "The 2006 $upertrader's Almanac - 1st Half Edition".

21. With the perception that an important low was at hand, emphasis was switched from weekly to daily and then to hourly CHARTS.

22. The hourly CHARTS suggested that the market was in the midst of a rare extended diagonal triangle decline.

23. We can see the blue Wave 4 high in the upper left corner of the following CHARTS posted on successive days.

24. From that high, we can then see the four blue numbers through the early April high and how the blue waves initially unfolded.

25. From the blue Wave 4 high in the middle of the CHART, the market then began a series of successive a-b-c movements as can be seen.

26. That bottom thick green trendline became key descending support to this decline.

27. From these patterns, the market appeared to have set the low with the divergences between the markets in the top row and those in the bottom row of the following CHART of daily prices:

28. And so it was that the final green Wave 5 decline ending the final black Wave 5 decline ending the final blue Wave 5 decline ending the final blue Wave 5 decline ending the entire black a-b-c-x-a-b-c decline of the prior year were all at hand as seen here:

29. But the market made one more minor decline to this low shown on the daily CHART.

30. Here's how the final low looked on the hourly CHART:

31. As soon as the bottom was set, however, the market unfolded in an a-b-c advance as shown in the following CHART:

32. The red A-B-C counter-trend movement set the next low at the .786 price retracement level marked in the CHART by the red horizontal dotted line.

33. From this low, the market unfolded in the following manner a couple of weeks later and was in place to end the initial advance.

34. From the high, a week later, the market had set the black Wave A low and black Wave B high and seemed poised to decline to the price level marked in the CHART at the black horizontal arrow pointing to the right.

35. The next day, the low was set and a blue Wave 1-a-b-c-2 sequence seemed complete, placing the market in position to stage the next leg of the advance.

36. From this low on 601, the market advanced over the next couple of weeks and found itself in position to end that segment of the upmove as can be seen in this CHART:

37. A very interesting divergence occurred at this high as the markets in the top row of the following CHART made new highs versus those in the bottom row which did not.

38. In fact, the one in the lower right corner of the above CHART made a new low for the year, thereby prompting the CHART to be issued.

39. A few days later, the market in the lower left corner also made new lows and the rest had declined.

40. The question in the top row was whether the scenario presented in the upper left corner more accurately stated the current position of the complex, or whether it was the one in the upper right corner.

41. If the one in the upper left corner, then the market was in position to find solid support at the lower green ascending channel trendline shown here:

42. This support did not hold, and by the end of the month, the markets leading the decline to new lows were ready to end the declines as shown by this CHART:

43. The CHART was issued during the week between the two weekly projections shown in the following two CHARTS:

44. Since the lows, the complex has advanced with all 4 markets now making new highs for the move since the recent lows as shown in today's CHART #597 of daily prices.

45. CHART #598 shows daily prices for one of these markets.

46. When we inspect this CHART, we can see how price has advanced as expected since the late June low.

47. What is rather interesting is how the net short commercial position has declined sharply over the last few weeks as price has rallied.

48. This decline is seen in the bottom box by the red line and comes at a time when the short red sloping lines show that such momentum oscillators as RSI and Slow Stochastics are diverging with the new price highs of Friday, thereby signaling important price / momentum oscillator divergences.

49. It was also highlighted here in the weekly CHART:

50. The light blue shading above the January high shows that the down-up sequence lasted 92 trading days (FIBONACCI #=89).

51. From the January high, the down-up sequence to Friday's high lasted 145 trading days (FIBONACCI #=144).

52. 236 total from the blue Wave X high of last September (FIBONACCI #=233).

53. The red horizontal dotted line shows that this market has retraced about 50 percent of the January to June leg down (see pages 185-7 of "The $upertrader's Reference Manual").

54. If the June low completed a complex a-b-c-x-a-b-c low in June, then there is no impediment to further gains.

55. However, if the original weekly CHART of last year is still in play, the question becomes whether the 1104 low, 118 high, 628 low and Friday's high have formed Waves 1 through 4 of a 5 wave impulsive decline that has much more to go on the downside.

56. For this to happen, the 118 to 628 decline would have to be, itself, a 5 wave impulsive sequence.

57. When we look at the dates identified in the CHART #598, we can see that these 5 waves are identified by the 307 low, 316 high, 515 low, 613 high and 628 low.

58. The measurement of these waves is marked on the CHART by the black text above the March high.

59. The calendar version is 48-9-60-29-15=161 days (100 X PHI = 161.8) with W3 / W5 = 4.000.

60. At the bottom, we can see that the up / down and total relationships are all PHI-related.

61. An important element of this movement occurred when the 613 high remained below the 307 low as marked in the CHART by the first thin pink horizontal line.

62. In similar manner, Friday's high is a tad below the November low marked in the CHART by the thick horizontal pink line allowing for the November low to remain as Wave 1 and for Friday's high to be Wave 4.

63. A decisive break of this line will, thus, negate the bearish interpretation just discussed for this market and will strengthen the case for the a-b-c-x-a-b-c outcome.

64. We can see how we are at the expanded blue descending pitchfork line as seen in the CHART.

65. The four red up and down arrows show the Astro turning point projections from page 376 of "The 2006 $upertrader's Almanac - 2nd Half Edition".

66. We can see that the beginning of the (assumed) Wave 4 rally to Friday's high began in earnest at the first such date in the book and that the high was right next to the most recent date.

67. It is especially significant that the last high of importance in mid-June and the current high have both occurred amidst WIC (Weekly Inversion Cycle Index) projected turns from the April-September edition of "The $upertrader's Book of Linear Time Cycles".

68. These two WIC projected turns are marked in the CHART by the small blue boxes above price.

69. Let's look at the Inversion sheet for that book in CHART #601.

70. The small circle shows the present WIC projected turn.

71. But note that this listing is unaccompanied by other markets in the complex.

72. Instead, the big circle shows when it seems to appear that a period of time that should be more important to the complex occurs.

73. We can see that the trading technique presented on pages 205-9 of "The $upertrader's Reference Manual" is set up for short side entry Monday.

74. CHART #599 updates daily prices for the continuous spot futures contract.

75. Here we see a similar situation.

76. From the blue Wave X high in the upper left corner, the decline to the May low is shown as a black Wave A-B-C movement.

77. But as can be seen to the right of the CHART, price has moved up into the red MLC (Monthly Linear Time Cycle Index projected high).

78. This MLC projected high is marked in the CHART by the red box above price.

79. The thick pink horizontal line drawn from the low of last November is in the same position as the in the prior CHART.

80. An important event occurred at the green horizontal line drawn from the May low.

81. In late June, whereas other markets in the complex were lower than the May low, this particular market in the complex held above the May low, thereby forming an important divergence between the markets in the complex (see pages 171-84 of "The $upertrader's Reference Manual").

82. The other points from the #599 CHART are similar to the prior #598 CHART and will thus not be repeated with the exception of a couple.

83. First, the blue Wave 5 portion of the black Wave C decline labeled in the CHART are in relation, as shown by the black bracket, of 1.636 (PHI=1.618).

84. The two A-B-C segments (see the blue box below the November low) are in relation of 2.208 (SQ RT 5=2.236).

85. Price can be seen as having made its way up to the upper red channel trendline shown in the CHART over the last 3 months.

86. But this market is not, from the standpoint of the net commercial position, in the negative extreme seen in the #598 market.

87. In fact, at the end of July/beginning of August, as price advanced, so did the net commercial position, an unusual occurrence.

88. This unusual occurrence is even further magnified in the #600 CHART of daily prices for the continuous spot futures contract.

89. We can see how price came out of the hole at the green and blue MIC, WIC and WLC boxes at the bottom of the CHART.

90. The essence of what has happened this year has thus, essentially, been the decline from the one MIC (Monthly Inversion Cycle Index) projected turn as marked in the CHART by the big blue box in the upper left corner to the next MIC projected turn which is marked in the CHART by the thick blue box in the lower right corner.

91. Also of interest is the increased bullish position over the last two months as prices have advanced and the increased bearish position of the large speculative interests.

92. These positions are maked by the black and red lines in the bottom box.

93. Here we can see that these positions for both are the most positive for price this year.

94. This position is directly opposite of that in the #598 CHART.

95. This market is also set up for short side entry via the trading technique presented on pages 205-9 of "The $upertrader's Reference Manual".

96. An Elliott Wave interpretation has been added in the #600 CHART that seems pretty clearly defined.

97. The black text presents the trading day characteristics of this movement.

98. Note that the labeled portion is only from mid-July to early August and that it does now include the entirety of the advance since the late June low.

99. In the middle box, we can see that such momentum oscillators as RSI and Slow Stochastics are failing to confirm the new price highs over the last few days, thereby forming important price / momentum oscillator divergences (see pages 171-84 of "The $upertrader's Reference Manual").

100. CHART #602 shows 15 minute bars for the September futures contract through the close Friday.

101. The momentum oscillator divergence seen on the daily CHART can be seen to be extending to the 15 minute bar CHART.

102. The conclusion of all this is that we want to honor the trading technique presented on pages 205-9 of "The $upertrader's Reference Manual" and use it to exit positions, but not to enter new short positions at this time.

103. Ideally, the markets will advance, take out the thick horizontal pink lines identified in the above discussion, and will, thereby, negate the likelihood that the complex is setting an important Wave 4 high of a decline that is not yet complete.

104. Should the pink horizontal line be taken out by all the markets in the complex, the implication will be that the market has set the a-b-c-x-a-b-c low seen above and that price is moving still higher.