American market hits bottom

This is a harsh reality, but masses don’t understand cycles and the uncanny asset linkages. The fact is that we at Orpheus too are also scratching the surface. Though there are market timing models, timing the market in future with a small time window of a few days, is a skill we look up to. As of now, we know only a few who can do this consistently. We attempted timing the market with a calendar month in JULY, when we talked about OCT LOWS. And it was only in our last mail that we mentioned that the cycle low was still unwinding and OCT lows could be marginally breached. The reality is that DOW 10 OCT low still stands firm. And the marginal breach we talked about did not happen on DOW but on S&P.

The 27 OCT Low on INDIA pushed Index prices up 45%. A similar time window saw ROMANIAN Indices pushing up 70%. And this also happened on many other indices across the globe. We witnessed ‘first five’ in many our assets and regions we tracked, and INDIA with all its B MINOR wave uncertainty continues to show a lot of resilience. Even NIKKEI seems to make a PREFERRED ‘first five’ up. With all this activity and non confirmation between INDICES like S&P and DOW, engulfing bullish formations on FTSE and CAC, positive moving average crossovers on many emerging market stocks, KEY REVERSAL BARS across INDICES on weekly time frames, decade high volatility panic just behind us, most DOW 30 stocks suggesting that ADVANCE-DECLINE data is too skewed on the negative side, OIL and GOLD still on the negative territory and the primary bear more than a year old, we continue to believe that the multi quarter bounce back is here. The current entry points remain a low risk entry point and AMERICAN markets and global markets have hit at least an INTERMEDIATE BOTTOM. Primary? Maybe.

If there is any BULLISH REPRIEVE, it should be now. And I don’t think BULLS would like to waste their few quarters of chance they need to survive in an otherwise long secular bear market. There is one more intermarket reason. Though S&P has historically underperformed DOW, the index has a performance – underperformance cyclicality against DOW. The pair has also hit a CYCLE low, both on an intermediate and primary basis. This suggests that the broad 500 blue chips can’t underperform the top 30 blue chips of the world any more. And what do we need for a turn around? We need the broad market to rise. And this is what we feel should happen.

The report carries anticipated and happened cases on INTEL. “We highlighted Intel anticipated case in WAVES.GLB.050808 issue when at 22.52 we said that Intel should move up in an A-B-C corrective up till 26 before turning down. Correctives are counter trends which are short-lived. After which the trend resumes. This is what happened as prices moved back below 18.5 and are now pushing lower potentially till Oct 2002 low at 12.95. These are the last support standing for Intel. A break here can see Intel push lower till 10.” Prices hit a low of 12.87 yesterday. This was below the 09 OCT 2002 low. We have also carried another anticipated and happened case on BANK OF AMERICA.

Enjoy the latest WAVES.GLOBAL

WAVES.GLOBAL – WAVES.GLB is a perspective product published on Monday. The report highlights top GLOBAL indices and emerging market indices viz. Dow Jones Industrial (.DJI), S&P 500 (.GSPC), German DAX (.GDAXI), Russian IRTS (.IRTS), Shanghai Composite (.SSEC), Nikkei 225 (.N225), Brazil BOVESPA (.BVSP), Indian Sensex (.BSESN). The product covers all the DOW 30 stocks. The product highlights Primary (Multi Month) and Intermediate (Multi Week) price trends. The report illustrates key price levels, price targets, price projections and time turn windows. The product uses Elliott waves, traditional technical analysis tools, sentiment indicators and other alternative research tools like INTERMARKET to spot outperformers and market trends.

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