Wednesday, August 03, 2011


Here is a daily bar chart of the cash S&P 500 displaying the past 20 months activity.

  • Today we saw a high volume breakout below the March and the June 2011 low points.
  • This was also a clearly defined breakout from a head and shoulders top formation (blue lettering).
  • At the same time the market broke well below its 200 day moving average.
  • All are classic sell signals. Many well respected technical analysts have announced the start of a new bear market.
  • economic news is terrible
  • BUY - BUY - BUY !!


George Rahal said...


bbfinance said...

OK. Bought. Will see how far your prediction is correct.

Kishore said...

Carl, it does not really matter whether or not your "buy signal" turns out to be right. But what really does matter is that you are once again, like you do everyday, "guessing the bottom". Personally, I don't think that is a good trading habit.

Moreover, contrarian approach is valid only after a trend has been in place for quite sometime. I don't think that it can be applied in the beginning of a new trend, if it is new down trend.

Bill said...

I believe Carl may have called the mother of all bottoms. And he's been proven right so far and may very well be proven right over the next few weeks and months.

philfromparis said...

contrarian view !
i love !

Win said...

Thanks, Carl! You really are the man. This is truly the mother of all contrarian signals, and you may just be right. BTW, bears, check out the huge bear market in the AAPL and GOOG charts. Sell! Sell! Sell!

Kishore said...

It takes a while to form a bottom. It should have some shapely pattern, a reverse head and shoulder or a double bottom etc.. For a double bottom to form, we need, at least, a retest of today's low.

However, once again, calling tops and bottoms is not good for trading, though it is a good exercise for the ego, which, incidentally, is even worse, for trading that is.

For trading, there are better buy and sell signals than calling bottoms and tops!

Adsense said...

Where was the spx cash index 32 trading days ago .and again 32 trading days before that . do that 5 times from today and you will see what i mean . low low high low low . the bounces have been fairly storng lasting 14-15 trading days following these lows.
i posted it here if your interested in seeing what i mean .
good luck

Moody said...

LOL check out the article on CNBC! If thats not the biggest buy signal then i don't know what is!

Gann-Lover said...

There is something like 27 days after the 7th new moon each year, check it out. It's a crash-signal, which ofcourse is not a free lunch but something has to consider this as 'serious' enough now since that date. So , calling a bottom is 'impressive', but assuming that this is a failure break Head and Shoulders is no TA, but simple guesswork.

Sorry Carl, you are a good analyst, but let's face the charts only. They always tell you the truth, which cannot be said of the rest of the world, lol.