Bond Market Update

I think yields are headed up again and bond prices are headed downward. I think the long bond yield will rally at least to 4.95% from its current 4.75%. I also think the bond futures are on their way to 110 or a little lower, while the notes are headed for 108.

S&P Update

The Fed news dropped the e-minis to 1533.75 where the bulls took over and rallied the market up to 1558.75 (so far). I think the implication of this action are bullish if we look ahead more than a week, but I also think the market is due for a 25 point break and that the 1564 level is likely to be resistance and the starting point of the decline. So the next trade I make will probably be on the short side.

Guesstimates on October 31, 8:15 am ET

Spiders - December S&P E-mini Futures: The Fed news is coming out at 2:15 pm New York time today. Moreover, the underlying market trend is still upward. The combination of these two things means that I am not going to put on any short side trade before the news comes out. I might put on a long side trade if the news pushes the market down into the 1520-30 range. I am sticking with my view that the 1492 low will hold and that the next upside target is 1595.

QQQQ: The Q’s are at resistance and I think a brief drop to 53.70 or so is likely before the market continues upward to the next target which is the 56.00 level.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. Support stands at 113-06. TLT should rally into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-24 or so before a more substantial drop develops. Support is at 110-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude is headed for 96.50. Support stands at 88.60. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: Gold has nearly reached the 800 target but the trend is still upward with support at 770.

SLV - December Silver: It looks like silver will reach 1500; meantime support is at 1330.

Google: GOOG is nearing its 705 target but the trend is still upward. Support stands at 670.

S&P Trade

In this morning's guesstimate I said that the e-minis were a short at 1547. So far that level has not been reached today. As a rule I don't initiate positions after regular trading hours and since this trade would be against the direction of a multi-week uptrend I am canceling my sell order now.

I am inclined to give this trade one last chance tomorrow but Fed announcement comes out tomorrow at 2:15 pm New York time. So I want to see how the market handles itself between now and tomorrow's open before I put any new orders in.

Guesstimates on October 30, 8:15 am ET

Spiders - December S&P E-mini Futures: The 1551 stop was it at the exact high of the day yesterday. The narrow range encourages me to believe that the market will dip at least into the 1520-30 range before it heads higher again. The e-minis are a short today at 1547 with a 1557 stop. Profit taking target is 1525.

QQQQ: Resistance today is again at 54.30 and I think we shall see another drop to 53.20 or so before the market moves up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. Support stands at 113-06. TLT should rally into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-24 or so before a more substantial drop develops. Support is at 110-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude his headed for 96.50. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: Gold nearly reached the 800 target yesterday in early morning trading but the trend is still upward with support at 770.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

S&P Update

It looks like the e-minis will close above 1544 and as I have said this is good evidence that the 1492 low is going to hold. Today the market traded in a very narrow range at the top of a strong rally. I think this is a minor sign of weakness and means that we shall see a break down into the 1520-30 range before another up leg can start.

S&P Trade

The 1551 stop was hit a few minutes ago. The presumption now is that the 1492 low will hold. A close today over the 1544 level will strengthen this presumption. Still, I think this market is likely to drop to 1525 or so before it gets as high as 1560.

Guesstimates on October 29, 8:15 am ET

Spiders - December S&P Futures: Still working the 1551 stop. If it is hit the odds would then favor continuation upward to new bull market highs, but only after a reaction of 10-20 points first.

QQQQ: Resistance today is again at 54.30 and I think we shall see another drop to 53.00 or so before the market moves up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. Support stands at 113-06. TLT should rally into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-24 or so before a more substantial drop develops. Support is at 110-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude his headed for 96.50. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

S&P Trade

Short at 1541.00. The right tactic here is to work the 1551 stop during both the electronic and regular trading hours sessions.

Guesstimates on October 26, 8:30 am ET

Spiders - December S&P Futures: Today I think the futures are a short at 1541, again with a 10 point stop. Profit taking target will be 1521. If the stop should be hit the odds would then favor continuation to new bull market highs.

QQQQ: Resistance today is at 54.30 and I think we shall see another drop to 53.00 or so before the market moves up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. Support stands at 113-06. TLT should rally into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-24 or so before a more substantial drop develops. Support is at 110-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude broke 90.00 decisively this morning so the next upside target is 96.50. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

S&P Update

The short position's profit taking target at 1507 was reached a few minutes ago so all other orders are canceled and there is now no open position.

S&P trade

This morning during regular trading hours the December e-mini futures rallied to 1529.75 thus triggering a short side trade at 1529. The market has since dropped to 1507.25, just shy of my 1507 profit taking target. My tactic for the rest of today is to lower the buy stop to 1521, cover if the market hits 1507, and in any event close the trade at 3:55 pm New York time, 5 minutes before the close of the New York Stock Exchange's day session.

Guesstimates on October 25, 8:15 am ET

Spiders - December S&P Futures: I still think the futures are a short today at 1529 using a 10 point stop. The market did trade at 1529 an hour ago but I prefer to make my trades during regular trading hours. Profit taking target will remain at 1507. I expect another step downward to1480 or so before a move to new bull market highs can begin.

QQQQ: Resistance today is at 54.30 and I think we shall see another drop to 53.00 or so before the market moves up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally a bit more, probably up into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude is on its way to 90.00 but I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

Guesstimates on October 24, 8:30 am ET

Spiders - December S&P Futures: The futures closed on 1525 resistance yesterday and will open lower. However I still think the rally has a little bit left in it so the market is a short at 1529 with a 10 point stop; I would exit this trade if it does not show a profit by 4pm New York time. Profit taking target is 1507. I expect another step downward to1480 or so before a move to new bull market highs can begin.

QQQQ: Resistance today is at 54.30 and I think we shall see another drop to 53.00 or so before the market moves up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally a bit more, probably up into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude has support at 82.00 but I think we shall see only a brief bounce from that level. I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

Tale of the Tape

The last tale can be found here.

LEADERS:

GOOG: Support is at 630. Google is headed for 705.

IBM: A rally to 130 is underway.

GS: I think GS will rally to 250.

CME: I think the market will rally to 675 before the bull market ends.

MO: Support is at 65. Upside target is 75.

OF INTEREST:

BIDU: No sign that the bull market is over. Support is 295. Next upside target is 390.

CSCO: Support is at 25. Next upside target is 40.

AAPL: Upside target is 190. Support is 115.

MSFT: Support is at 26.50. Next upside target is 33.50.

ICE: Next upside target is 190. Meantime support is at 124.

NYX: Support stands at 63. I think a rally to 90 is underway.

NMX: I think the action in NMX bodes ill for crude oil prices and for the price of NMX itself. Resistance is at 135 and the 100 level will be seen later this year.

PFE: Support is 22.50. Upside target is 30.

AMGN: A rally to 62 is likely but the bear market in AMGN is not over.

SHLD: A bear market in SHLD is underway. Resistance above the market is 155 and the next downside target is 105.

KFT: Support is at 30. Next upside target is 39.

AMZN: Upside target is now 105. Support is at 65.

EBAY: Support is at 30.00. Market should reach 50 in a few months.

WMT: Headed for 55. Support is at 42.50

Guesstimates on October 23, 8:40 am ET

Spiders - December S&P Futures: The 1525 level is resistance today in the futures. I expect another step downward to1480 or so, but I don’t think it wise to take a short position today given that the longer term trend is still upward.

QQQQ: Support today is again at 51.50. This is just a normal reaction in a bull market. It now looks like support at 52.50 will hold and that the market will head up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally a bit more, probably up into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude has Support at 82.00 but I think we shall see only a brief bounce from that level. I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

Guesstimates on October 22, 8:50 am ET

Spiders - December S&P Futures: The market closed below 1512 support Friday and has moved as low as 1492 early this morning. I think it is a buy at 1487 using a 1477 stop. The first rally will probably last only a day or two and carry the market up 30 points or so. Later this week I expect to see a 1475 print on the S&P’s ( and a 146.50 print on the Spiders). This is still just a normal reaction in a bull market.

QQQQ: Support today is at 51.50. This is just a normal reaction in a bull market. It now looks like support at 52.50 will hold and that the market will head up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally a bit more, probably up into the 92-93 range.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Crude has Support at 82.00 but I think we shall see only a brief bounce from that level. I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE was not reached but I don’t think the market will make it there now.

GLD - December Gold: The trend is still upward with target 800 and support is at 745.

SLV - December Silver: It looks like silver is headed back to 1500 and support is at 1330.

Google: I think that a rally to 705 is underway. Support is at 630.

S&P's, Spiders, and QQQQ's

Here are daily charts of the December S&P e-mini futures and of the QQQQ's. I last commented on these markets here and here.

The futures hit the 1533 level this morning and as I have said in the daily guesstimates I think this means the market is headed for the 1512 level which is support as I have indicated on the daily chart. From there I think we shall see the start of a rally to 1610. Support in the Spiders should be found at 150.20.

The Q's have been acting stronger than the S&P's so I think they will remain within the recent trading range which has its low near 52.10. The next step up in the Q's should carry them to 56.00.

Guesstimates on October 19, 8:30 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1560 (at 155.00 in the Spiders) and support is still at 1538 (1528.00). I now expect to see the futures rally to 1610. Should the S&P’s instead drop as low at 1533 then I will expect continuation down to 1510 followed by a rally to 1610.

QQQQ: It now looks like support at 52.50 will hold and that the market will head up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – December Crude: Switching to the December contract. Crude has moved a bit above the 86-87 resistance zone but I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: December gold is heading for 800.

SLV - December Silver: It now looks like silver is headed back to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

Guesstimates on October 18, 8:15 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1560 (at 155.00 in the Spiders). The market dropped a bit below 1538 support yesterday but the subsequent strong bounce makes it likely that the drop from 1587 is complete. I now expect to see the futures rally to 1610. Should the S&P’s instead drop as low at 1533 then I will expect continuation down to 1510 followed by a rally to 1610.

QQQQ: It now looks like support at 52.50 will hold and that the market will head up to 56.00.

TLT - December Bonds: I think the bonds will rally into the 114-115 range. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Crude has moved a bit above the 86-87 resistance zone but I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: December gold is heading for 800.

SLV - December Silver: It now looks like silver is headed back to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

Guesstimates on October 17, 8:20 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1562 (at 155.20 in the Spiders) and support is at is at 1538 in the futures and 152.80 in the Spiders. Once this reaction is complete I expect to see the futures rally to 1610.

QQQQ: The market will probably drop to 51.50 and then resume the bull market advance.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-00 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Crude has moved a bit above the 86-87 resistance zone but I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: December gold is heading for 800.

SLV - December Silver: It now looks like silver is headed back to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

Guesstimates on October 16, 8:15 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1567 (at 155.70 in the Spiders) and support is at is at 1538 in the futures and 152.80 in the Spiders. Once this reaction is complete I expect to see the futures rally to 1610.

QQQQ: The market will probably drop to 51.50 and then resume the bull market advance.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-00 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Crude has entered the 86-87 resistance zone and I think the next significant move will be downward. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: December gold is heading for 800.

SLV - December Silver: It now looks like silver is headed back to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

Gold

Here are two point and figure charts of GLD, the gold ETF. The price of GLD (multiplied by 10) tracks the price of spot gold very closely and I like to use it as a good proxy for gold futures as well.

For the past 15 months I have believed that the May 2006 top at 732 was the end of the bull market in gold. The price action of the past month has shown this view to be wrong. So what lies ahead?

The point and figure charts you see above both point to the 79-81 range as the next stopping point for GLD. This corresponds to a range of 790-810 for spot gold. Longer term I still do not expect the spot price to go higher than its 1980 top at 850. I think that the entire trading during the past 15 months which developed between 550 and 700 showed many more signs of distribution than of accumulation, especially since it occurred near the high end of the rang for the past 25 years.

Guesstimates on October 15, 8:40 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1575 (at 156.50 in the Spiders) and support is at is at 1538 in the futures and 152.80 in the Spiders.

QQQQ: The market will probably drop to 51.50 and then resume the bull market advance.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-00 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: December gold is trading above 760 as I write this so I think it is heading for 800.

SLV - December Silver: It now looks like silver is headed back to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

Guesstimates on October 12, 8:30 am ET

Spiders - December S&P Futures: Resistance above the market stands at 1570 (at 156.00 in the Spiders) and support is at is at 1538 in the futures and 152.80 in the Spiders.

QQQQ: The market will probably drop to 51.50 and then resume the bull market advance.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-00 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16..

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO has been reached as has the 200-205 target for OIH. The 80 target for XLE has nearly been reached.

GLD - December Gold: Yesterday gold took a brief peek above the top of its resistance zone in the 750-55 range. I still think it will drop from here, but a move above yesterday’s high at 759 will mean I am wrong and that the market is headed for the 800 level.

SLV - December Silver: Silver has so far stayed below 1405 but more strength than that will mean the market is headed up to 1500.

Google: I think that a rally to 705 is underway. Support is at 590.

S&P 500

Here are two charts of the cash S&P 500 index. The first is a daily chart and shows the intermediate term boxes which have formed on the rally from the August 16 low. The second chart is a weekly chart which shows the bull market boxes from the October 2002 low at 768. I last commented on this second chart here.

As you can see the S&P is nearing the 1588 level which is the top of its second box off of the low at 1370. This is a logical spot to expect a reaction of 40-50 points, about the size of the last reaction on the way up. If such a reaction does materialize the market should find support in the 1530-40 range which is the 1/2 division point of the box and also the top of the rally right after the last rate cut by the Fed.

Looking further ahead I lean towards the view that this market is going to get close to the the optimistic point and figure target at 1780 which I cited in this post. How close? Well the S&P is now showing a tendency to repect the 3/4 and 1/4 division points of its long term boxes (instead of the 1 and the 1/2 division points it respected during the 2002-2006 period). The 1/4 point of the next long term box stands roughly at the 1740 level and it coincides (naturally) with the top of the second box defined by the July top at 1555 and the August low at 1370.

A less optimistic scenario would call for a top near the 3/4 point of the current box which is roughly 1645 and coincides with the long term point and figure count from the 2002 low which you can see here.

Guesstimates on October 11, 8:00 am ET

Spiders - December S&P Futures: Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1538 in the futures and 152.70 in the Spiders.

QQQQ: Continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-08 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has reentered the zone of strong resistance in the 750-55 range. I still think it will drop from here, but strength above 756 will mean I am wrong and that the market is headed for the 800 level.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 705 is underway.

Guesstimates on October 10, 8:10 am ET

Spiders - December S&P Futures: Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1538 in the futures and 152.70 in the Spiders.

QQQQ: Continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-08 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has bounced off of the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Google and Baidu

Here is a weekly chart of Google and a daily chart of Baidu.com. I last commented on Google here and on Baidu here.

GOOG and BIDU are leading the market higher. You can see that Google has reached the top of its second box near the 618 level and normal action here would be a least a brief drop to 575 or so. I am revising my upside target at bit to the confluence of two Fibonacci targets in the 705-708 range. The 705 level is 610 points above the low trade price of 95 for GOOG the day after its IPO in 2004. The 708 level is 377 points above the 331 low established in March of 2006.

BIDU blew right past the top of its second box and will probably continue up at least to the top of its third box at 373 and eventually higher than that.

Guesstimates on October 9, 8:30 am ET

Spiders - December S&P Futures: Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1538 in the futures and 152.70 in the Spiders.

QQQQ: Continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: I think the bonds will head up into the 114-115 range. A break below the 110-08 level will mean I am wrong and that the market has resumed its drop to 105-106. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-16.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 115.00. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has bounced off of the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Nasdaq Composite

Here is a weekly chart of the Nasdaq Composite Index. I last commented on this chart here.

The Nasdaq has established new bull market highs and I think it will continue up at least to the 2900 level. This is the 2 5/8 multiple of the 1108 low as well as the 1 / 2 division point of a 338 point box (the length of the July-August drop) stacked on top of the 2734 top in July.

Whether or not the 2900 level will mark the end of the bull market remains to be seen, but I think this is more likely to be true than not.

China

Here is a daily log scale chart of the Shanghai composite index. I last commented on this market here.

As you can see the index is within a 100 points or so of my 5650 target. I think the next significant development will be a break of 800-900 points, about the same amount (arithmetically) as the last significant reaction. I should note that at about the 5800 level the market will have advanced the same percentage as the February-May rally. This is another reason to expect a stall in the 5600-5800 range.

After this next break is over I shall expect another leg up of about the same percentage as the current leg (70-75%). Such a move would put the index above the 8000 level.

Guesstimates on October 5, 8:30 am ET

Spiders - December S&P Futures: Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1530 in the futures and 152.00 in the Spiders.

QQQQ: The Q’s are nearing their initial target at 52.50 but continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: Support is at 111-04. The action in the bonds makes me think that the market is now headed back into the 114-115 range. However I also think that will be a ceiling for the market and that a substantial drop will follow. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops. Support is at 108-00.

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Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess now is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.25. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has bounced off of the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Guesstimates on October 4, 8:10 am ET

Spiders - December S&P Futures: Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1530 in the futures and 152.00 in the Spiders.

QQQQ: The Q’s are nearing their initial target at 52.50 but continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: The action in the bonds makes me think that the market is now headed back into the 114-115 range. However I also think that will be a ceiling for the market and that a substantial drop will follow. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops

.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess now is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.25. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has entered the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Tale of the Tape

The last tale can be found here.

LEADERS:

GOOG: Support is at 565. Google is headed for 650.

IBM: A rally to 130 is underway.

GS: I think GS will rally to 250.

CME: I think the market will rally to 660 before the bull market ends.

MO: Support is at 65. Upside target is 75.

OF INTEREST:

BIDU: No sign that the bull market is over. Support is 275. Next upside target is 335.

CSCO: Support is at 25. Next upside target is 40.

AAPL: Upside target is 190. Support is 115.

MSFT: Support is at 26.50. Next upside target is 33.50.

ICE: Next upside target is 190. Meantime support is at 124.

NYX: Support stands at 63. I think a rally to 90 is underway.

NMX: I think the action in NMX bodes ill for crude oil prices and for the price of NMX itself. Resistance is at 135 and the 100 level will be seen later this year.

PFE: Support is 22.50. Upside target is 30.

AMGN: A rally to 62 is likely but the bear market in AMGN is not over.

SHLD: Has reached support at 132. The next move should be upward to 155.

KFT: Support is at 30. Next upside target is 39.

AMZN: Upside target is now 105. Support is at 65.

EBAY: Support is at 30.00. Market should reach 50 in a few months.

WMT: Headed for 55. Support is at 42.50

Guesstimates on October 3, 8:15 am ET

Spiders - December S&P Futures: The market broke out to the upside from a two week trading range yesterday. Next upside target is 1600 in the futures and 159.00 in the Spiders. Short term support is at 1530 in the futures and 152.00 in the Spiders.

QQQQ: The Q’s are nearing their initial target at 52.50 but continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: Yesterday’s action in the bonds makes me think now that the market is headed back into the 114-115 range. However I also think that will be a ceiling for the market and that a substantial drop will follow. TLT should rally back to 90.

December 10 Year Notes: It now looks like the notes will rally to 111-08 or so before a more substantial drop develops

.

Euro-US Dollar: Support beneath the market stands at 140.50. The historical high in the euro is 145.75 which was reached in 1992. My best guess now is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.25. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has entered the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Guesstimates on October 2, 8:10 am ET

Spiders - December S&P Futures: The market broke out to the upside from a two week trading range yesterday. Next upside target is 1600in the futures and 159.00 in the Spiders. Short term support is at 1530 in the futures and 152.00 in the Spiders.

QQQQ: The Q’s are nearing their initial target at 52.50 but continuation up to 54.50 is likely before a reaction of a couple of points begins.

TLT - December Bonds: The bonds are headed down to the 106-107 zone. Resistance above the market stands at 111-24. TLT is on its way to 84 but I expect the June low at 81.20 to hold.

December 10 Year Notes: The notes are headed down to 105. Resistance above the market stands at 109-24.

Euro-US Dollar: The market has moved decisively passed the 141.00 level. The historical high in the euro is 145.75 which was reached in 1992. My best guess now is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop. Support beneath the market stands at 140.00.

Dollar-Yen: Support in the yen is at 113.25. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: Support in crude oil is at 79.00 and I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has entered the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver has moved a little past resistance at the 1380 level but will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.

Another Long Term Look at the S&P

Here is a point and figure chart of the cash S&P. Each box is 10 points high. I last commented on this chart here.

As you can see the August low formed at the long term support line which rises from the 768 low in 2002 and also developed at a price level just shy of the downside count target from the June-July 2007 top. This is a good indication that the bull market is still in progress.

Next note that the long term count target which developed at the 2002 low is still above us at 1640. Moreover, you can see an upside breakout from a big base which formed during August. A count from this base projects mechanically to the 1780 level. I think this latter count target is a bit optimistic, but is does indicate that the bull market in the cash S&P is not nearly over.

Guesstimates on October 1, 8:30 am ET

Spiders - December S&P Futures: The market has held short term support at 1522 and should rally to 1590 or so. (Corresponding levels for Spiders are 150.50 and 158.00.) If, contrary to my expectation, weakness below 1515 does develop then I would expect continuation down into the 1470-80 range before a rally to new highs begins.

QQQQ: The Q’s should reach 52.50, a new bull market high, before a reaction of a couple of points sets in.

TLT - December Bonds: The bonds are headed down to the 106-107 zone. Resistance above the market stands at 111-20. TLT is on its way to 84 but I expect the June low at 81.20 to hold.

December 10 Year Notes: The notes are headed down to 105. Resistance above the market stands at 109-24.

Euro-US Dollar: The market has moved decisively passed the 141.00 level. The historical high in the euro is 145.75 which was reached in 1992. My best guess now is that the market will take a peek above there, probably hitting 146.00 and that this will be followed by a multi-month drop.

Dollar-Yen: Support in the yen is at 113.25. Looking ahead several months I expect to see the 130 level during the next 12 months.

XLE - OIH - USO – November Crude: The 81.00 level was penetrated decisively so I think crude will move up into the 86-87 zone before turning lower. The upside target for USO is now 64. I expect OIH to rally into the 200-205 zone and ELE to hit 80.

GLD - December Gold: Gold has entered the zone of strong resistance in the 750-55 range and should soon start an extended decline. This breakout to new bull market highs is one that should be faded.

SLV - December Silver: Silver has moved a little past resistance at the 1380 level but will probably stay below 1405. The start of an extended drop is near.

Google: I think that a rally to 650 or higher is underway.