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doc

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Reply with quote  #1 
I haven't posted Hursts updates in a while as the market since Feb has been in a Gary Smith style tight rising channel without any apparent regard to shorter length cycle lows or people shorting the market for that matter. Clear awash in liquidity.

Well I am posting now as I believe we are approaching a Hurst 80wk low and that could be a downward pressure to be reckoned with short term (or not!).
Remember, some cycle lows you drop into and others you rise out of. Cycle lengths have been shortening as is characteristic of bull markets and plentiful liquidity.

Aug 2007, 4.5 year low
Mar 2009, 1st 80wk low
July 8, 2009:   1st 20wk low = 83TD for the 20wk cycle
Nov 2, 2009:   2nd 20wk low, also a 40wk low
Dec 18, 2009: 10wk low = 34TDs for the 10wk cycle
Feb 5, 2010:   3rd 20wk low = 35TDs for the 10wk cycle and 69TD for the 20wk cycle
Mar 26, 2010? :  10wk low? = 35TDs for the 10wk cycle

The very short 10wk lows of 34-35TD inplicate 20wk cycles of 69TDs and that would target May 13th as the next 80wk low. That is in 11 TDs. Now the previous 20wk cycles were quite a bit longer than 69TD. The July-Nov 09 one was 83TDs. So if the 80wk low gets nasty, it could come in 1-3wks later than May 13th which is based on the super hot and shorter cycle lengths.

If I am right, there should be a downward bias into the 80wk low and some additional downside targets should appear as we go lower. The big trick is to know what length TDs the cycles are currently to figure out the FLDs to use, lol.

One caveat: the AD line has been incredibly bullish and with the McSums up so high, I don't expect the start of a new downtrend, just a correction in the uptrend. If the current world worries blow over, it could still be an 80wk low at higher levels too.


Hope this is helpful...

Doc

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fib_1618

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Reply with quote  #2 
Quote:
...it could still be an 80wk low at higher levels too.

Yup...cycle nestings can either be ones in which price moves down into or moves up out of a particular structure.

Thanks for the update...helpful indeed.

Fib


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hiker

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Reply with quote  #3 
thank you for the update, Doc.

for reference at a future date, here is the:

April 29th update for the Bullish Percent Index values since 1996 for the SPX, and five sectors within the SPX -



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doc

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Reply with quote  #4 
The drop into the Hurst 80wk low that I posted on after the close April 28th has gained momentum. We are now building the internal lows IMHO probing for a flag on NYMO and NAMO. The final price lows will come later next week or possibly the next, hopefully with bullish divergence on the internals. So far, price damage targets 1144-50 area for that low using FLD analysis on the Hurst cycles. It should be pointed out as well that price right now is leading breadth to the down side as in Jan-Feb. and surprisingly, high yield bonds are not confirming this downturn as they were in Jan-Feb. indicating that liquidity is not a big issue at this time. This makes it likely that there will be higher highs again after this low. It also leaves open the possibility that the downside targets may not be reached.

Other fun facts:
Namo broke below it's Uptrendline from Nov 09, but the 5% trend is still positive and $NAUD remains strong so that suggests corrective action.
NYMO remains above its UTL from Nov lows and I'd like to see it stay above the divergent lows of Feb at the -75 level, otherwise this correction could be deeper. Its components still suggest correction. As expected, NYSI fell off the "ledge".

Finally, the NYA closed today where it closed after the first trading day this year. All the other gains have been wiped out and we are roughly 150 NYA points from the close of 12/31/09 and from the highs of last Oct.

Doc
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hiker

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Reply with quote  #5 
hi Doc - an idea to consider relative to your overall cycle view:

May 5 - cumulative NYAD (NYSE breadth) since 2002, with the daily closes for selected index values:

* will the prior horizontal breakout value (221789) for the cumulative NYAD shown on the chart below contain the current NYSE breadth pullback shown by the cumulative NYAD?

      *** be alert what occurs, prior key cumulative NYAD breakout levels during the advance off the March, 2009, low have held when tested from above ***

* note that SPX price now resides above its $1161 major price horizontal



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doc

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Reply with quote  #6 

Hello Hiker,

You wrote:"* will the prior horizontal breakout value (221789) for the cumulative NYAD shown on the chart below contain the current NYSE breadth pullback shown by the cumulative NYAD?"

Why is (221789) a special "horizontal breakout value"?
I've always wondered where and how you draw your horizontal lines on all of your charts be it stock or index charts. Some appear as important S/R points over the years, but some don't really look too obvious to me.  I remember way back about 5 yrs ago Ted Burge had a public stockcharts area and drew the horizontals at key breakouts of UTL and DTLs off of candlestick charts using the bodies and not the tails. I know you used to follow his work closely and refer to his horizontals. He later moved to tid-tac-dough but i've lost track of him.

Anyway, price is still leading breadth to the downside and fairly dramatically so unless this time is different, once the Hurst 80wk low I am looking for bottoms, much or all of this price decline should come back unless new fundamental shocks arise and breadth really does fall apart and catches up to the downside.

After Wed close, NYMO finds itself oversold and at the UTL from the Nov lows, an good place for at least a snapback rally. NAMO has matched and microscopically taken out the Feb lows. NYA today traded down to the lows of the first trading day of the year and bounced a bit. NYA is up 1% for the year now. The other indexes are doing far better, esp RUT and VLE.

As far as the NYAD is concerned, I'd expect it to dip below its 10 and 5% trends and drag the 10% trend down to or close to the 5% trend. I wouldn't be surprised if the NYSI gets dragged down to the +500 or even the +250 level. Perhaps Fib will chime in if he gets the chance.

I think the depth of this correction will depend on how much damage occurs in Europe and perhaps China and the shockwaves it sends around the globe. I think that the financials will be key in holding up or breaking the market. Awhile back you posted and I answered that 15.25 was a key S/R on the weekly chart for XLF. We are at 15.93 for now. It would be fitting for this correction to end with XLF at around the 15.25 level and launching the next up from there.

Why is 1161 a major horz on SPX? My current SPX target is around 1144 level.

Doc

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hiker

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Reply with quote  #7 
SPX $1161 - reply to your first question about the SPX $1161 major price horizontal:

* see the 2004 to 2005 price action - first resistance, then later proven in 2005 as tested and confirmed horizontal support, then failed support for a relatively brief period in 2005.
--------------------------------------------------------------------------------

regarding the cumulative NYAD discussion:

* the cumulative NYAD level is much more simple - a new high level on the way up, and simply marks a level to be tested as a "failed" or as a "confirmed" breakout level ... and I do consider it significant if the cum. NYAD does actually move below it or actually "confirms" the prior breakout level as "support" now in play for a further sustained advance.   New highs for cumulative NYAD, when tested from above, are significant just like when AAPL  tested $251.14 on May 5 (a prior new all-time high similar to the characteristic for the cum. NYAD we are discussing)

AAPL 60-minute chart view and AAPL weekly chart view attached showing $251.14 prior new all-time high for AAPL which was tested from above on May 5

------------------------------------

Doc, regarding the final item of discussion which is your lower target for the SPX during this current SPX decline:

* the values that I have shown on the cumulative NYAD 221,789, SPX $1161, and $251.14 for the AAPL charts must
cooperate and in fact achieve a "failed" breakout status in order to achieve lower lows than we saw on May 5 .... so these chart values can serve as simple monitoring levels that your view of the future actually is confirmed or negated as the breadth and price action progresses beyond May 5.

  * I am simply suggesting some marker values for assessing whether the lower price target idea you have does in fact progress on the price and breadth chart as you expect.   SPX $1161 may or may not hold when next tested, but it will clearly state a valid chart fact IF it does in fact hold, and IF it is not retested this week or next week OR never again retested and we simply advance higher from here.


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hiker

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Reply with quote  #8 
May 5 chart values

* the purpose of the chart shown below is two-fold:

1. depict relevant horizontal values for other chart elements worth monitoring, whether your trading bias is bullish or bearish

2. will serve as useful look-back reference at a later date

* XLF - $15.70 was the May 5th intraday low, for reference if this level is retested by the future price action ...it will be an important piece of the test of the horizontal support level shown in the chart below



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Reply with quote  #9 



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hiker

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Reply with quote  #10 
May 5

* NYA $7241 is of interest as a horizontal based on the most recent months' price action ...

see the lower portion of the immediately above chart AND this chart shown below for the NYA (NYSE Composite Index)

Doc, what is your target into the "80week low" for the NYA?



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hiker

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Reply with quote  #11 
May 5

SPX daily, with NYSI and with one selected metric for the NYSE and SPX internals -

* NYSI 880 level is the "gap resistance" level from the October, 2009, NYSI action



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hiker

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Reply with quote  #12 
May 5

XBD daily chart, and the horizontal zone(s) is derived from both a multi-year time reference, as well as the 2009/2010 period:



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hiker

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Reply with quote  #13 
May 6th update for cumulative NYAD:

Attached Images
Name: cum_NYAD_-_May_6.png, Views: 161, Size: 134.91 KB



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hiker

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Reply with quote  #14 
May 6th update for SPX daily closes (now below its 89-day ema) and for NYSI and other NYSE breadth metrics and internals:

Attached Images
Name: SPX_daily_closes_-_$1148.13_is_the_89-day_ema.png, Views: 160, Size: 110.47 KB



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doc

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Reply with quote  #15 
Quote:
May 5

* NYA $7241 is of interest as a horizontal based on the most recent months' price action ...

see the lower portion of the immediately above chart AND this chart shown below for the NYA (NYSE Composite Index)

Doc, what is your target into the "80week low" for the NYA?


Hi Steve,

I texted a friend this morning at 11:56 am CST that NYA at 7170 had dipped into the red for the year and had generated a Hurst downside target of 6965. I also noted a target of 1105 for SPX as well. Well we got down to 6666 on NYA, but quite frankly I forgot to mention to him that it would be met and exceeded by 300 additional points within 3 hours!

Doc
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doc

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Reply with quote  #16 
I still think that the 80wk low is ahead of us as the recent increase in volatility, VIX, ATR, is generally correlated with an increase in the local cycle length. I had originally forecasted May 13th as the likely time period for the low. I now believe it may come later, perhaps a few days, perhaps as much as a couple of weeks. I don't have any new targets at this time, 1100-1105 area on SPX is still targeted, met and may be retested as might the 1050 level.

Doc
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