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 Goldilocks and the 3 Bears (FTSE100, DOW, S&P500
Many investors are commenting on why the NASDAQ is performing better than the S&P500 and DOW. They are waiting for the NASDAQ to correct and fall back in line with the S&P500 & DOW. Are their thinking correct???
Answer:-- maybe not...There are other forces at work which get scant media coverage such as the differing rates of recovery seen in each individual indexed market.
The charts below clearly show that the FTSE, DOW and S&P500 are still in a technical bear market mode and are lagging behind the rest of the worlds indexes which have already signaled a bull recovery....so one could assume that there is a good chance the FTSE, DOW and S&P500 will eventually follow the rest of the world Equities and recover into a new Bull cycle, rather than seeing the rest of the world fall back to match the 3 bears
One thing that's certain ....the Global Equities Market are no longer in tandem (correlated) ...that perfect storm ended in 2008
The charts below show a green line which once crossed (upwards) signals a technical bull market... confirmed with the crossing of the MA200.
On the NZX50 chart I have left in the old downtrend channel as this is interesting...as it may signal that this recent weakness may not be a bull trap but a false break.
As shown on the charts many markets are retesting their technical Bull levels making investors nervous and raising fears of a Bull trap as happened in 1930.
The 3 Bears
Attachment 1744
Attachment 1745
Attachment 1746
The Rest... Post #2
Last edited by Hoop; 28-06-2009 at 01:19 PM.
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Last edited by Hoop; 28-06-2009 at 01:15 PM.
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Update...DOW, S&P500 bull market cycle comfirmed ..2 bears have died only one remains
 Originally Posted by Hoop
Many investors are commenting on why the NASDAQ is performing better than the S&P500 and DOW. They are waiting for the NASDAQ to correct and fall back in line with the S&P500 & DOW. Are their thinking correct???
Answer:-- maybe not...There are other forces at work which get scant media coverage such as the differing rates of recovery seen in each individual indexed market.
The charts below clearly show that the FTSE, DOW and S&P500 are still in a technical bear market mode and are lagging behind the rest of the worlds indexes which have already signaled a bull recovery....so one could assume that there is a good chance the FTSE, DOW and S&P500 will eventually follow the rest of the world Equities and recover into a new Bull cycle, rather than seeing the rest of the world fall back to match the 3 bears.
Update: - The assumption is correct. As of today's 2+% the DOW and S&P500 have followed the rest of the world and have recovered to comfirm a new Bull market cycle.
One thing that's certain ....the Global Equities Market are no longer in tandem (correlated) ...that perfect storm ended in 2008.
Update: - Most of The worlds Equity indexes are in differing Bull Market phases The Shanghai index being the most mature of those mentioned in this thread.
The charts below show a green line which once crossed (upwards) signals a technical bull market... confirmed with the crossing of the MA200.
On the NZX50 chart I have left in the old downtrend channel as this is interesting...as it may signal that this recent weakness may not be a bull trap but a false break.
Update: - Yes it turned out to be a false downward break.
As shown on the charts many markets are retesting their technical Bull levels making investors nervous and raising fears of a Bull trap as happened in 1930.
Update: - It was no Bull trap as it turned out, so those fears have been subdued for the time being. In actual fact the false trend break downward turned out to be a bear trap as the indexes are now back in a strong uptrend again.
The 3 bears have been reduced to one...the FTSE
The 2 bears that have changed to Goldilocks
DOW broke key 9000 resistance level (now a support level) confirms a primary uptrend (Bull market cycle confirmed**)
The S&P500 broke key 950* resistance level (now a support level) confirms a primary uptrend (Bull market cycle confirmed**)
* some TA purists consider the 1000 resistance level the key level.
** retesting and respecting the new supports needed to reduce the chance of a false break
Last edited by Hoop; 24-07-2009 at 11:15 AM.
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Thanks for the update Hoop. Very informative.
Having got ourselves into a debt-induced economic crisis, the only permanent way out is to reduce the debt – either directly by abolishing large slabs of it, or indirectly by inflating it away.
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7 months have passed since the last post.
Update:-The 3 laggards (Bears) have made up ground on the Goldilocks that confirmed the end of the Cyclic Bear market first.
Presently we notice that the S&P500 has caught up and is now at the same Cyclic Bull Market maturity level as the All Ords.
Although the S&P500 and All Ords have tracked very similar lines together during these last couple of years..the confirmations of the recent cyclic bull market stages were at different times, the All Ords had always confirmed first then S&P500 would follow.
As of now the S&P500 has caught up and confirmations are now within the same time frame ...so the advantage of using the All Ords confirmation knowing that the S&P500 would follow is now gone (maybe not ..see below).
The simple example of follow the leader is on the charts below.... see how together both indexes had first confirmation that the cyclic bear was over during March of 2009...but the American investors fretted over their bull market with the fears of it being an extended bear market rally only to be finally put to rest when the S&P index broke up passed the primary downtrend line in early November 2009 a good 6 weeks after the All Ords confirmation.
Notice how the All Ords chart showed a more matured cyclic bull market at that time with the earlier confirmation of the primary downtrend line break.
Since then the All Ords has experienced a double dip bull market correction giving the S&P500 index a chance to catch up.
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The big question that some may ask when noticing these charts ...Is this S&P500 catch up an illusion??
The Shanghai index was the leader out of the latest Cyclic Bear market (3 months ahead) and has the most mature cyclic bull cycle.
Are the indexes still following the Shanghai Leader?
A no answer if:
1....a breakout above 4980 for the All Ords.
2....a breakout above 1150 for the S&P500, but only if 1 above applies...otherwise apply caution. (remember the Xmas All Ords bull trap)
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THE LEADER INDEX?
Attachment 2443
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Originally Posted by Hoop
Hoops busted his data cap (20Gigs)
thats a lot of securities charts!
For clarity, nothing I say is advice....
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Originally Posted by peat
thats a lot of securities charts!
LOL nice one Peat
My Household = 4 Kids + 2 Adults....4 laptops + one desktop + 2 PS3s + Wii + bluetooth mobile smartphones = need lots of data...20Gig/month poof!! gone...easy
I realise that we are not a normal household but without constraint I estimate my household could use 60Gig/month high speed data now with new services appearing such as TV on demand on the PS3 and easy access to free internet TV station websites via media players. Just a year ago 20Gig/month was ample.
With HD and shortly 3D + new wireless internet capable toys it wouldn't surprise me that an average household in the near future..say 5 years time after everything has gone to wireless interactive digital.. would need 100Gig/month ultra high speed (+50MB/sec) affordable data stream.
Access to large fast data will happen it inevitable ..just unfortunate that the planners at Telecom in that past monpolistic environment couldn't (or refused to) see far enough ahead to plan for the future...and now the Govt..too late as usual has stepped in under urgency and haste to try and rectify and this could turn out to be a very messy solution for the taxpayer.
...but this is off topic and should have a thread of its own.....
Edit...Dial up speed suxs
Last edited by Hoop; 29-04-2010 at 10:17 AM.
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Originally Posted by Hoop
Quote from my 15 March 2010 post
. ..The big question that some may ask when noticing these charts ...Is this S&P500 catch up an illusion??
The Shanghai index was the leader out of the latest Cyclic Bear market (3 months ahead) and has the most mature cyclic bull cycle.
Are the indexes still following the Shanghai Leader?
A no answer if:
1....a breakout above 4980 for the All Ords. update YES but fallen back ...looking like another bull trap???
2....a breakout above 1150 for the S&P500, but only if 1 above applies...otherwise apply caution. (remember the Xmas All Ords bull trap) Update YES
Conclusion : Yes no maybe...therefore there is uncertainty so apply caution.
The Shanghai Composite index is looking more and more like it could be in a cyclic bear market cycle..too early to totally confirm yet... but the first confirmation was the start of the primary downtrend (August 2009) which was upgraded to primary status by the breaking of the primary uptrend line in mid January 2010.. the second confirmation could be today if it breaks the 29000 major support level ...
The last confirmation would be the breaking of the primary support at 2650.
Watch for the Hang Seng, if there is a break below 21000 the primary downtrend will resume making the recent trend breakthrough rally on the 6 april a bull trap...If the 21000 level holds look for another possible rally....however with the Shanghai looking doubtful the 21000 Hang Seng support area is under serious threat of breaking.
The All Ords is also showing the Shanghai index shape and lagging a couple months behind Therefore the breaking of the 4900 major support will not come as any major surprise.
If the Western Equity markets are lagging up to 3 months behind the Chinese equity markets then a warning should be issued now of a possible ending of the cyclic bull market.
Our biggest and best Goldilocks is looking like an asian bear
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Sorry no charts ..due to NZ national dinosaur internet/phone infra-structure  ..Hoops busted his data cap (20Gigs) yet again and is on dial up speed for the rest of the month  ....feels like I'm reliving the 1990s.    
I wrote this warning on the 28th of April.
It seems everyone except me has blamed Europe for this correction but here I go again harping on that the world equity markets could be following the Shanghai path.
Why????..I have no idea.
However if Shanghai is the long term leading indicator* a cyclic market change may happen here first..so we investors should concentrate our attentions not only with the S&P500 or the DOW but also add the Shanghai Composite to our attention list.
* Copper and base metal index are reliable short term leading indicators ..rapid fall a few days before the Equity rapid fall etc...
OK...... Shanghai become an Asian bear on 12 May broke 2650 primary support
The All Ords is the first to follow Shanghai ...Ozzi bear confirmed today.
who's next ....
Remember my earlier posts... the 3 laggards FTSE, S&P, DOW......yep... they are still lagging... They have entered the technical correction phase (-10%) but have not yet reached primary downtrend levels yet, so still technically in a cyclic bull market cycle.
The only major European sharemarket to enter a technical bearish downtrend so far is France's CAC.
So where to from here.. sadly if the Shanghai effect is true it would seem more pain for the USA / European markets to the point that they too will become cyclic bears within the next month or two.
Key Index points of Interest
.......................Closing prices....Primary Support Levels.......major SL............Cycle
Shanghai Composite..2514 ..12 May 2650...................27 April 2890....12 May Bear
India BSE30............16520 .............13200.............................156 50............Bull
Hang Seng..............19546...............17200....... ......................19420...........Bull
Nikkei..........intraday 9778.................9050...................21 May 9870........DT Bull
All Ords.......intraday 4239.....21 May 4280..............................4500....21 May Bear
NZX50.........intraday 3042................3028....................21 May 3060........DT Bull
DAX........................5868................520 0..............................5430.............Bu ll
FTSE100..................5073................5000. .............................5030.............Bull
CAC........................3433................340 0..............................3550.........DT Bull
NASDAQ..................2204................????.. ..............................2100.............Bul l
DOW......................10068...............????. ...............................9900.............Bu ll
S&P500...................1071................1000. ..............................1050.............Bul l
*DT Bull ....bull market cycle intact with the index in a short/medium term bearish downtrend
UPDATE: (3.21pm) Breaking News.... Australian Dollar sudden rise ..market intervention is suspected All Ord risen in response to test the 4280 primary now resistance level.
It seems OZZI don't like its new founded bear status...a futile attempt? we shall see.
Last edited by Hoop; 21-05-2010 at 03:23 PM.
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Originally Posted by Hoop
UPDATE: (3.21pm) Breaking News.... Australian Dollar sudden rise ..market intervention is suspected All Ord risen in response to test the 4280 primary now resistance level.
It seems OZZI don't like its new founded bear status...a futile attempt? we shall see.
not just the AUD rising though, so may not be intervention. Pretty obvious if you look at the charts that the SNB intervened to stop the CHF rising against the Euro.
For clarity, nothing I say is advice....
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