Live: Friday, April 13, 2018

4/13 – 4 p.m. New York time

As we approach the closing bell, my assessment of the market relies entirely on my Elliott wave count of the small levels of SPY chart, working from Minuette down to Submicro.

By my count, on April 1 we competed wave 5 of the Mubmicro level within the C wave at the Micro level, which in turn wraps up the 2nd wave at the Subminuette level. This is all taking place within a 3rd wave  of the bearish Minuette 3rd wave that began on March 13.

In terms of strategy, I would have done best to get out at the Minuette 3rd wave top, but that didn’t happen. The present 3rd wave down at the Subminuette level will give me some respite and in turn provide an opportunity to exit at a profit.

Below, a 20-minute chart of SPY covering March 29 to April 13, annotated with my Elliott wave analysis.

The Subminuette level in Elliott has the number or letter within a circle, but that is not possible on my platform, so I have used square brackets.

SPY_20180413

4/13 – 3:15 p.m. New York time

SPY has declined during the day, remaining within the upper reaches of its present sideways channel. I placed no trades.

4/13 – 11:55 a.m. New York time

SPY continues the sideways course established from the March 23 low. I shall continue to hold my options positions, which expire in mid-May. Entry analysis of my positions may be found here and here.

The bear market that began  Jan. 26 has turned my trading on its head, as I moved from rapid-fire earnings plays to a slower paced trade in index funds.

A Bloomberg News article published today suggests that I’m not alone: “The Stock Market Is Getting What It Abhors“, by Jaren Dillian.

By Tim Bovee, Portland, Oregon, April 13, 2018

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Live: Thursday, April 12, 2018

4/12 – 3:20 p.m. New York time

I made no trades today.

4/12 – 11:25 a.m. New York time

Same song, different day. SPY continues a near-term sideways pattern, which I count as an upward correction within an ongoing downtrend.

Expiration of my options in the positions is more than a month away, so there’s time for the correction to complete its work and the downward movement to resume.

I hav two positions in SPY, whose entry analyses are  here and here. I have been concentrating my efforts on broad indexes since the bear market began on Jan. 26 and have no entries into new positons in sight today.

By Tim Bovee, Portland, Oregon, April 12, 2018

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Live: Wednesday, April 11, 2018

4/11 – 2:50 p.m. New York time

SPY has barely moved during the day, as the markets approach their final hour of trading. I exited no positions today and entered none.

4/11 – 11:20 a.m. New York time

In the first hour of trading SPY has remained within the sideways range that began in late March. I shall continue to hold my positions (entry analyses here and here).

By Tim Bovee, Portland, Oregon, April 11, 2018

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Live: Tuesday, April 10, 2018

4/10 – 3:15 p.m. New York time

SPY remains below the high of April 5, continuing its sideways movement. I have exited no positions and entered none.

4/10 – 11:50 a.m. New York time

SPY remains bound within a range, today’s high so far staying below the April 4 peak within the present sideways move. Like yesterday, it’s a wait-and-see day.

Facebook Inc.’s CEO Mark Zuckerburg testifies before Congress today about the company’s handling of user data security. FB is has the 4th largest market capitalization among the S&P 500 companies, so if his hearing produces any OMG! moments, the index on which SPY is based might get a short-term bump.

The entry analysis for my positions on SPY are here and here.

By Tim Bovee, Portland, Oregon, April 10, 2018

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Live: Monday, April 9, 2018

4/9 – 3:25 p.m. New York time

With less than an hour to go before the closing bell, SPY has stayed within the prior trading day’s range. Basically nothing has changed on the chart, and I have taken no action on my positions in the ETF, which tracks the S&P 500.

4/9 – 10:10 a.m. New York time

The S&P 500, which underlies my positions in the exchanged-traded fund SPY (analyses here and here). In Elliott wave terms, the index continues to work through what appears to be a 2nd wave correction to the upside within a downward 3rd wave at the Minuette level, my preferred level for trading.

At this point there’s no need to exit the positions and I have no new positions in sight.

By Tim Bovee, Portland, Oregon, April 9, 2018

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The Week Ahead: Prices and minutes

With the latest employment situation report out of the way, the economic reporting machinery has descended into lethargy. There’s not much happening in Econworld during the week, although I’m quite certain traders will find excitement elsewhere to keep the markets churning. President Trump? China? We’re counting on you.

The producer price index (final demand) will be published on Tuesday  and the consumer price index on Wednesday, each at 8:30 a.m.

The Federal Open Market Committee will release minutes of its March 21 meeting, in which it voted, without dissent, to raise the federal funds index by a quarter point to a 1.5% to 1.75% range. There might be surprises. I’m betting not.

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Live: Friday, April 6, 2018

4/6 – 3:15 p.m. New York time

The S&P 500 has continued to decline, benefiting my bear positions on exchange-traded fund that tracks the index, SPY (analyses here and here). The percentage of maximum profit on each position stands below 25%; my goal is to exit at 50% or higher.

No exits today, and I have no new positions in sight. Look for The Week Ahead to be posted on Saturday.

4/6 – 10:40 a.m. New York time

My Elliott wave count of the S&P 500 is unchanged from yesterday. I plan no exits from existing positions at this point, nor do I plan to enter any new positions.

I took a look at FXE, which tracks the EUR/USD exchange rate, but have decided not to pursue a trade at this point.

By Tim Bovee, Portland, Oregon, April 6, 2018

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Live: Thursday, April 5, 2018

4/5 – 3:25 p.m. New York time

I entered no new positions and exited none.

4/5 – 11:10 a.m. New York time

I’m continuing to focus on the broad indexes, using Elliott wave analysis. By my count, SPY attained a major peak on Jan. 26 and has reversed  in an impulse wave to the downside. That is, it has been a bear market since that day.

Early on in such reversals it is difficult to know exactly at what level each wave stands. By my count we are in a 3rd wave down at the Minuette level, beginning March 13, and within that wave, a 2nd wave up at the Sub-Minuette level.

The lower-level up wave is contrary to my bear positions. They options used to construct them expire in mid-May, and so I shall wait and see how the lower-level wave develops.

My goal generally is to trade the Minuette level, but it’s a guideline, not a rule.

I have no new positions in sight at this point. I plan to take at FXE, which tracks the EUR/USD currency exchange, to see if it is of interest.

By Tim Bovee, Portland, Oregon, April 5, 2018

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Live: Wednesday, April 4, 2018

4/4 – 3:15 p.m. New York time

I entered no new positions today and exited none.

4/4 – 11:25 a.m. New York time

The S&P 500 remains in a 3rd wave down by my count using Elliott wave analysis. This mornings price decline brought one of my bearish vertical spreads on SPY to 27% of maximum potential profit, and the other to 10%. My goal is 50% or better, so I am taking no action this morning.

I have no prospective new positions today.

By Tim Bovee, Portland, Oregon, April 4, 2018

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SPY Analysis

SPDR S&P 500 ETF (SPY)

I have entered a short vertical bear spread on SPY, using options that trade for the last time 45 days hence, on May 18. The premium is a $4.13 credit and the stock at the time of entry was priced at $259.00.

I made the decision to enter the trade based on the Elliott wave count. I see SPY as being in a 3rd wave down within a 3rd wave down at the Minuette level, which is what I normally trade, within a 1st wave down at still higher levels.

The present wave down, which began on March 13, has yet to move below the Minuette 1st wave endpoint of $252.92 on Feb. 9. A decline below that level, which I’m betting on with this trade, will confirm that the 3rd wave is underway. A move back to the upside would suggest that the 2nd wave in the upward correction is not yet complete and doing something other than a simple zig-zag. Since 2nd waves almost always tend to be simple zig-zag patterns, I would be surprised to see something more complex happen. 

Time will tell, of course, and if I am proven incorrect in my judgement, my analysis will tell me when to get out in order to mitigate my losses.

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