Archive for May 2012

5/17/12 – Oversold, Bounce, and Then Bottom © ™

May 16, 2012

Looking at the oscillators on page two of my charts, it’s looking like the market is getting oversold. I’m thinking a decent rally is due soon, followed by another bottom and that’s it. If not before, watch for a late Friday rally. Those rallies can be an early indication for the following week.

Hurst cycles is saying some time before the end of the month is the bottom. End of the month could spill over into early June. The cycles are not date precise but the size of this cyclical bottom is precise and significant (33 week). If the cyclical date is correct, it could mean the second bottom would be in the area of the next low, meaning double bottom. Just an idea for a possible scenario. And then if we don’t get a second bottom, that would also explain the timing.

Watch for a throw away day on the downside. That might mark the bottom, or close to it. That’s the bang ending. The whimper is the refusal to go down as the market zig zags along a slower developing bottom (sold out bottom).

Watch the dollar for a top too, although a dollar top might have news associated with it. Recently the dollar has been a source of pain for stocks and commodities.

Do you ever look at the growth stocks on pages 4 and 5? Some of those stocks have done really well, while others . . . not so good.

I’m writing on my iPad and that means a simple update. I’ve had little time this week to track the market and will have even less time next week. I might miss all the fun. That would be disappointing and unprofitable.

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