Trading Nymph's Stock Trading Diary

This is  a Great Article that explains the Basics of The China Copper Market

COLUMN-China copper imports strong but bulls beware!: Andy Home

(Andy Home is a Reuters columnist. The opinions expressedare his own)
LONDON, Nov 10 (Reuters) – China’s copper imports in October
were the highest monthly total since May 2010 and
confirm that the step-change in September was not a statistical
blip.
At 383,507 tonnes aggregate imports of refined copper,
copper alloy, copper anode and copper products were marginally
up on September’s figure and a lot higher than the
subdued flows seen in the early part of this year, when
China’s copper sector was in destocking mode.
True, the cumulative figure of 3.11 million tonnes for the
year to date is still down by 13.5 percent from last year but
the gap is now narrowing very quickly.
This will all be grist to the mill for bruised copper bulls. The
implication is that so far at least Chinese demand for copper
is holding up well even while other parts of the manufacturing
world, Europe in particular, adopt a defensive
crouch as euro crisis becomes creeping credit crisis.
But bulls should be wary of over-simplifying the shift in
import dynamic seen in the last couple of months.
Link for copper imports

http://link.reuters.com/xax84s

DESTOCKING OVER?
For copper bulls the most positive reading of China’s accelerated
imports in September and October is that the stocking
cycle has turned.
There had been growing evidence over the third quarter
that China’s collective ability to destock copper was reaching
its limits.
Visible inventory on the Shanghai Futures Exchange
(SHFE) tumbled, hitting a four-month low of 61,248 tonnes
at the end of October.
Equally significantly, so too did stocks in bonded warehouse
in Shanghai. They seem to have returned to something
close to a “normal” level of just below 200,000 tonnes.
The resulting appetite for extra units in China was reflected
in strong premiums for both Shanghai bonded metal and
fresh imports, $150-170 per tonne and $100-130 per tonne
over LME cash prices respectively.
Taken together, these signals meant that an acceleration
in copper imports was always on the cards.
Less good news for bulls, though, is that the sustainability
of this import momentum is now more likely to be about
outright price.
COUNTER-CYCLICAL
The LME benchmark three-month copper price collapsed
from over $9,000 per tonne to under $7,000 per tonne
over the back end of September and the early part of October.
As of this morning it was trading around $7,430.
These may not be “bargain basement” prices of the sort
seen during the 2008-2009 trough, when copper fell to
$3,000 per tonne, but they look relatively cheap compared
to the price strength seen up until September.
China, as the biggest global buyer at the margin, is understandably
going to capitalise on this price drop.
That’s a good reason for thinking that imports are going to
remain strong through at least the end of this year. Indeed,
they may well accelerate as the price impact feeds through
into physical metal flows.
But the key point here is that Chinese buying of copper is
counter-cyclical. When prices are high, China’s copper industry
will collectively destock and shift wherever possible
to less expensive forms of the red metal than refined cathode.
The market’s internal dynamics help it do so. Higher prices
stimulate more scrap supply, an important feedstock not
just for secondary metal producers but also for those fabricators
who can use scrap in their input mix.
Conversely, China will accumulate stocks on any pronounced
price weakness, a behavioural trend that is underpinned
by the reality of less scrap availability.
We saw the same pattern in 2008. And we’re seeing it
again now.
China’s copper imports therefore tell us as much about the
rest of the world, as transmitted by the LME copper price,
as about the state of demand in China.
And while Chinese buying may offer massive support during
times of low prices, it will not in itself be a driver of ever
higher prices.
IMPORTS OR IMPORTS?
The two-stage nature of the copper import process is another
reason for caution.
“Must-have” metal contracted annually between Chinese
consumers and non-Chinese producers forms the bedrock
of the country’s imports.
The headline monthly fluctuations, by contrast, reflect
shifts in spot market, or close-to-spot market, flows.
And much of this metal goes first to bonded warehouse in
Shanghai, at which stage it is classified as an import, and
only at later to a mainland buyer, at which stage VAT is
paid and it can be properly termed an import in the accepted
sense of the word.
So, how can we be sure that the accelerated flow of metal
in September and October fed into China’s demand dynamic
rather than into Shanghai “limbo”?
Statistically we can’t.
It’s only the abundance of secondary signals, such as
physical premiums and inventory trends, that suggest that
metal has really been “imported” rather than just being
counted as an import by customs officials.
Add to those China’s own slowing production growth and
anecdotal evidence of tightening scrap availability, both of
which should translate into greater need for imported refined
metal.
The problem for bulls is that some of those secondary signals
are now starting to turn. SHFE stocks, for example,
rebounded last week to the tune of 11,725 tonnes, while
physical premiums have come off the boil. That for bonded
metal has eased to $120-135 per tonne in the last few days.
(Continued on page 3)
FEATURE
3
Tight credit in China is likely to be a powerful constraint on
restocking by fabricators.
If their immediate requirements have been met over the
last couple of months, an increasing percentage of imports
will stay in the hands of merchants and go to rebuilding the
bonded warehouse buffer.
WHAT GOES IN
Events this year have shown that this two-stage import
process is far from being just a statistical quirk of the copper
market.
In principle, copper in Shanghai bonded warehouse is
where it is because China is the world’s top consumer and
will need it, if not right now then at some future date.
But given the right alignment of conditions, untaxed metal
in Shanghai “limbo” can turn around and head back out to
the international market.
It did so earlier this year when “exports”, better termed “re
-exports”, jumped to 144,000 tonnes in the Jan-May period
from just 19,000 tonnes in the previous five-month period.
At that time it was a combination of very high Shanghai
stocks, somewhere north of 600,000 tonnes, and a strike
by mainland buyers in the face of “too high” prices that
caused the mass turnaround. The market collectively
learned that “imported” metal in Shanghai was more liquid
than previously thought.
And the recent clampdown on the use of copper imports as
a financing tool may make this shadow stock yet more liquid
in its responsiveness to shifts in both arbitrage and premium
differentials.
So be cautious about the “bullish” implications of these
stronger imports. The bulls, after all, still maintain that it is
a matter of time before resurgent Chinese “demand” and a
still-deteriorating mine supply picture bite the LME market.
If that were to result in a sharp run-up in prices, Chinese
buying would dissipate. And if it were to result in LME cash
tightness and backwardation, that could be a powerful
draw for any “imported” metal sitting in Shanghai bonded
warehouse. What goes in can come out again.
Today’s import figure tells us only part of the story. It will
be the secondary signals that determine what really gets
imported.
FOlEATURE

The Numbers I am using come from the Work of Terry Laundry and Pitbull Trader Marty Schwartz who was featured in Market Wizards. I am focused in on how their work responds to Trendlines and the Zero Support Line. Following their work, there appears to be patterns that repeat themselves including formation patterns at the top and bottom. Terry also uses T theory to judge that movement. I have also added ISEE data along with TRIN to track them along with the Oscillator.

The Formula is (18 day from the previous day x.90+ Advance -decline Volume on NYSE )-(36 day from previous day x.95+ advance -decline volume/2) = Vol which I hand Graph

nov 18

Today Resistance is 560.000.000 for zero line, at this point we are on a downtrend

ADO (Advance Decliner Oscillator)  =

18 Vol  =5   36Vol = 35     Total Volume is -30

TRIN .56

Nov 17

ADO (Advance Decliner Oscillator)  =

18 Vol  =-97   36Vol = -12     Total Volume is -85

TRIN

Nov 16

ADO (Advance Decliner Oscillator)  =

18 Vol  =-114   36Vol = -16     Total Volume is -98

TRIN 2.27

Nov 15

ADO (Advance Decliner Oscillator)  =-65

18 Vol  =3   36Vol = 44     Total Volume is -41

TRIN 1.95

Oct 18,2010

Nov 9

Analysis…Volume Oscillator is just above the Zero level so until it moves below it, we must assume it will continue to move up in this very over bought market…but we are so close to the zero support line we may be  able to continue to move down if we can take out support volume level

For tomorrow..Wow, yesterday we needed -786,000,000 for advance -decline volume to get to zero line…we also made it, We need only Advance -decline volume of only -160.000.000

Resistance is the sky’s the limit at this point for volume

18 Vol  =98   36Vol = 92    Total Volume is 6

TRIN 1.56

Nov 8

Analysis…Volume Oscillator is above the Zero level so until it moves below it, we must assume it will continue to move up in this very over bought market.

For tomorrow..Support is so far down…we need a -786,000,000

Resistance is the sky’s the limit at this point for volume

18 Vol  =183   36Vol = 132     Total Volume is 51

TRIN 1.00

Nov 2

Analysis…

For tomorrow..OMG we are right at -1 which is at the cliff of Zero…resistance or support…we will find out tomorrow.

ADO (Advance Decliner Oscillator)  =

18 Vol  =66   36Vol = 67   Total Volume is -1

TRIN 1.03

Nov 1

Oct 27

Analysis…Having to deal with POMO, trying to see if it will hold under zero line

For tomorrow..Support is so far down…so we need just movement to the downside

Resistance is 0, which needs 431.000.000

ADO (Advance Decliner Oscillator)  =

18 Vol  =32   36Vol = 53    Total Volume is -21

TRIN .91

Oct 26

Analysis…Volume Oscillator is just below the Zero level so we will just try to stay below itl.

For tomorrow..Support is so far down…so we need just movement to the downside

Resistance is 0, which needs just a positive move to the upside

ADO (Advance Decliner Oscillator)  =

18 Vol  =65   36Vol = 71     Total Volume is -6

TRIN .90

Oct 22, 2010

18 Vol =53

36 Vol = 65

Vol =-12

Trin 1.00

Oct 21, 2010

Analysis…Volume Oscillator is still below the Zero level so therefore it should be a downtrending market still.

For tomorrow..Support is -39, which needs -295,000,000, and it should close below that

Resistance is 0, which needs 485.000.000

ADO (Advance Decliner Oscillator)  =

18 Vol  =29   36Vol = 58     Total Volume is -24

TRIN 1.19

Oct 20, 2010

Analysis..Today we attempted to retest the Zero Level, but as resistance. It failed to touch it. The volume today was much lower then yesterdays. Tomorrow, a NON POMO day, we will either try and test 0 or movedown below our Tuesday’s volume level of -39. With all the factors in front of us, a move down would be the most logical.

For tomorrow..Support is -39, which needs -600,000,000, and it should close below that

Resistance is 0, which needs 180.000.000

ADO (Advance Decliner Oscillator)  =

18 Vol  =59   36Vol = 69     Total Volume is -10

TRIN 1.95

Oct 19,2010

Analysis..we are below the Zero Support, we should continue down until we establish our formation on the bottom. Tomorrow we could have a slight move up to touch the downtrend line or we can continue down.

For tomorrow..Support is not clear

Resistance is -27, which needs xx

ADO (Advance Decliner Oscillator)  =123

18 Vol  =4   36Vol = 43     Total Volume is -39

TRIN 1.95

Oct 18,2010

Analysis..we held the Zero support, but we keep knocking against it. Maybe we will finally get my clean break I have been waiting for. Easy move to the downside, but it is holding

For tomorrow..Support, is 0 which only needs advance – decline volume of NYSE -207,000,000

Resistance is 50, which needs 793,000.000

ADO (Advance Decliner Oscillator)  =355

18 Vol  =116   36Vol = 99     Total Volume is 17

TRIN .74

Oct 15, 2010

Analysis..we are just below the zero support line…it’s make it or break it tomorrow for the market to see if it is a clean break

ADO (Advance Decliner Oscillator)  =280

18 Vol  =78   36Vol = 80     Total Volume is -2

TRIN 1.23

Oct 14

ADO (Advance Decliner Oscillator)  =375

18 Vol  =134   36Vol = 107     Total Volume is 27

TRIN 1.43

Oct 13

ADO (Advance Decliner Oscillator)  =494

18 Vol  =195   36Vol = 134     Total Volume is 61

TRIN .80

Oct 12

ADO (Advance Decliner Oscillator)  =377

18 Vol  =137   36Vol = 102    Total Volume is 34

TRIN .69

Oct 11, 2010

Analysis…We continue to push down to the Zero Support, will it hold again? Not sure…we can continue this forever it seems.

For Advance – Decline Volume we are looking for

resistance  is 50 which needs  590,000,000..

Support  is 0 which needs -410,000,000

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  =122   36Vol = 94     Total Volume is 28

TRIN 1.39

Oct 7, 2010

Analysis…We still haven’t hit our Zero Line but we should continue towards it. I have noticed we really don’t drop until we cross over it. Tomorrow could be a continuted slow move down towards it, TRIN and ISEE are about neutral on it.

For Advance – Decline Volume we are looking for

resistance  is 60 which needs  629,000,000.. THIS IS KEY  resistance which is the Drop Zone Resistance

Support One is 2 which needs -531,000,000 , this is downtrend line started 18 days ago

Support two is 0 which needs -571,000,000

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  =103   36Vol = 82     Total Volume is 21

TRIN 1.22

Oct 6, 2010

Analysis..Well, tomorrow we should continue down to our support levels. IMHO we finished the T off the Advance/decline Volume Oscillator that bottomed 9 days ago. TRIN is supporting downward movement too.

For Advance – Decline Volume we are looking for

resistance  is 59 which needs  348,000,000.. THIS IS KEY  resistance which is the Drop Zone Resistance

Support One is 9 which needs -652,000,000 , this is downtrend line started 18 days ago

Support two is 0 which needs -832,000,000

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  =132   36Vol = 95     Total Volume is 38

TRIN 1.05

Oct 5, 2010

Analysis..OK what was so fustrating….Monday we had advance -decline volume to get me to just a tick away from Zero on the Oscillator at 1…Tuesday WE had CRAZY HIGH VOLUME and where did it take us…..JUST below the Drop Zone Trendline…so we went from one support/resistance to the other….For tomorrow, would make totally sense to travel right back down…but we will see….For tomorrow advance -decline volume anything positive would take out resistance…and Support is just the same volume we had to today in the reverse direction…about -1,082,000,000

For Advance – Decline Volume we are looking for

resistance  is 54 which needs  anything up.. THIS IS KEY  resistance which is the Drop Zone Resistance

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  =157   36Vol = 104     Total Volume is 53

TRIN .31

Oct 4 2010

Analysis..We close just one point above zero, so right at support. So ALL we have to do is move down at all…so thats all I have been doing

For Advance – Decline Volume we are looking for

support one is 0 which needs  anything down.. THIS IS KEY  support that has to be taken out.

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  =54   36Vol = 53      Total Volume is 1

TRIN 1.38

Sept 29, 2010

Oct 1,2010

Sept 30,2010

Analysis..Today we saw our second day of divergence, the Adv-Decline was positive, while the Adv-Decline Volume was neg…tomorrow we are really close to breaking the last major support on very little downside volume, only -61,000,000 is needed. ISEE is low again, but TRIN is still not super large so we do have the gas to try and take it out clean.

For Advance – Decline Volume we are looking for

support one is 0 which needs -61 ,000,000 THIS IS KEY  support that has to be taken out.

resistance is 28 which needs 500,000,000

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  = 72  36Vol = 65      Total Volume is 7

TRIN 1.35

Sept 29, 2010

Analysis…this is it, make or break…we are at the tip of the formation…any movement either way will be a breakout. ISEE supports a move down.

Sept 28,2010

Analysis…Well with this rally that I missed today we are at one KEY MOMENT, We can take out major Resistance or Support just on how we move…if Resistance is taken out we could actually move up for 6 more days…Support is so close too, it’s our drop zone and it could go fast…it’s the Tip end of a Triangle formation….market has to decide…copper on LME hit top too….this is one magic moment either way.

For Advance – Decline Volume we are looking for

support one  is 29 which needs 0nly -90 ,000,000  THIS IS THE DROP ZONE, and we have to see if it’s a clean break to the downside..

support two is 0 which needs -589 ,000,000 THIS IS KEY  support that has to be taken out.

resistance is 38 which needs 171,000,000  this is the top of the downtrend and the fibo 61.8%

For Advance – Decline

Support is too low that it doesn’t matter

Resistances  is too high that it doesn’t matter

18 Vol  = 114  36Vol = 77      Total Volume is 37

TRIN .70

Sept 27, 2010

September 24,2010

Analysis…So close to the Drop Zone that market has to play with it.

For Advance – Decline Volume we are looking for

support one  is 19 which needs-111 ,000,000  THIS IS THE DROP ZONE, and we have to see if it’s a clean break to the downside..plus it’s 50% fibo level.

support two is 0 which needs -491 ,000,000 THIS IS KEY RESISTANCE FOR IT TO TAKE OUT IF ANY ATTEMPT CAN BE MADE

resistance is 48 which needs 469,000,000 this is the top of the downtrend.

For Advance – Decline

Support is 210, which needs -627

Resistances  is too high that it doesn’t matter

18 Vol  = 98   36Vol = 67      Total Volume is 31

TRIN .53

September 23,2010

Analysis..Well today we get to see if this break below my support levels will be clean…today they are the RESISTANCE levels. Makes total sense for our continued trip down, down, down.

For Advance – Decline Volume we are looking for

Support  is unsure…we are forming a downtrend line at this time

Resistance one  is 0 which needs 205,000,000  THIS IS KEY RESISTANCE FOR IT TO TAKE OUT IF ANY ATTEMPT CAN BE MADE

Resistance two is 15 which needs 505,000,000 THIS IS THE DROP ZONE, and we have to see if it’s a clean break to the downside

For Advance – Decline

Support is just  anything positive, that’s it.

Resistances  is too high that it doesn’t matter

18 Vol  = 15   36Vol = 25      Total Volume is -10

TRIN 1.32

Sept 22, 2010

Analysis,,,With such key support levels so close on the Adv-Decline Volume it would make not much sense not to go down and test them, ISEE and TRIN are about neutral. We could hold support and attempt another rally to resistance level…could be an interesting day.

For Advance – Decline Volume we are looking for

Support  One  is 8 which needs -112,000,000 THIS IS THE DROP ZONE

Support two is 0 which needs -272,000,000 if there is any attempt of a rally it will be here

Resistance  is 58 which needs 888,000,.000

For Advance – Decline

Support is 40 which needs -1950

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 70   36Vol = 52      Total Volume is 18

TRIN 1.21

Sept 21, 2010

Analysis..We continue our downtrend of the Advance -Decline Volume Oscillator. Tomorrow we FINALLY may get our first chance of testing support levels listed below.  We are getting closer to the Drop Zone support test, I am really curious how it is going to react to that. In hindsight over the last past week..I have to really learn to allow the price to bounce around more when it is up at that level, I can see it had no chance to move much higher and would fail, but many many don’t and I have to respect that…anyway…it’s beta testing so I am learning.

e is 62 which needs 579,000,000

For Advance – De

For Advance – Decline Volume we are looking for

Support  One  is 20 which needs -266,000,000

Support two is 5 which needs -566,000,000 THIS IS THE DROP ZONE

Support three is 0 which needs -666,000,.000

Resistanccline

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 113   36Vol = 72      Total Volume is 41

TRIN 1.24

September 20,2010

Analysis..Even though everyone was in strong bullish mode, the trend down in the Volume Advance Decline is still in tacked. What I observed in a previous move that the price of the market could just sit up here while the advance decline volume will move down. Today was very important because the Zero line was above the “Drop Zone”, the zero line could provide support but now with this move the Drop Zone will be the test before the Zero line and will set up for the massive move down that makes sense with the moves in the spot prices of commodities.

For Advance – Decline Volume we are looking for

Support  One  is 25 which needs -720,000,000

Resistance there isn’t any

For Advance – Decline

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 169   36Vol = 97       Total Volume is 72

TRIN .32

September 17,2010

Analysis..Firday was VERY interesting, We had a divergence in movement. The Number of Stocks that advanced was positive, while the volume was actually Negative. I have to watch how this plays out. Also, On the graphing of the the daily Oscillator of Advance-decline Volume we are trending down finally and should be testing the KEY Zero level and just below it which is what I have noticed is the “drop zone”…we will see how it plays out.

For Advance – Decline Volume we are looking for

Support  One  is zero which needs -620,000,000

Support Two is -8 which is the “DROP ZONE” which needs volume of -780,000,000

Resistance there isn’t any

For Advance – Decline

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 97   36Vol = 59       Total Volume is 38

TRIN .83

September 15, 2010

Analysis..There is no resistance target so any meltup has no place to go to, For support, just any neg volume moves us down under a key uptrend and could start a move down…finally.

For Advance – Decline Volume we are looking for

Support  One  is any move in negative volume

Support Two is 60 which needs

Resistance there isn’t any

For Advance – Decline

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 160   36Vol = 80       Total Volume is 80

TRIN 1.07

September 14, 2010

Analysis..There is no resistance target so any meltup has no place to go to, For support, just any neg volume moves us down under a key uptrend and could start a move down…finally.

For Advance – Decline Volume we are looking for

Support  One  is any move in negative volume

Support Two is 60 which needs

Resistance there isn’t any

For Advance – Decline

Resistances  is too high that it doesn’t matter

Support is so low that it doesn’t matter

18 Vol  = 160   36Vol = 80       Total Volume is 80

TRIN 1.07

September 13, 2010

Analysis..this market should have pulled back last week for a healthy market, we are at super bubble levels and all of it is just silly

For Advance – Decline Volume we are looking for

Support is -230,000,000

Resistance is 871.000.000 super high

For Advance – Decline

Resistances  is recent high of 630….need 1530

Support is so low that it doesn’t matter

18 Vol  = 190   36Vol = 89       Total Volume is 100

TRIN .54

September 9, 2010

For Advance – Decline Volume we are looking for

S1 of  50 which needs

S2 of 20 which needs

R1 there is none…just can float

For Advance – Decline

Resistances none

Support One is 110  which needs -2510

September 8.2010

Analysis..I guess I am just going to learn how to wait, after wild moves the ISEE is finally giving a high number at 156, We have a weaker TRIN at .83…we are starting our move down….we could move around be there is no longer any chance for a big up move. The way down will be a stair stepping down until we hit a point we can’t hit tomorrow, then we should free fall…

For Advance – Decline Volume we are looking for

S1 of  35 which needs -472,000,000

S2 of 17 which needs -832,000,000

R1 of 130 which needs  1,828.000,000 this is historically the top of the breadth. If it hits, the breadth volume will be declining to lower levels.

For Advance – Decline

Resistances none

Support One is 110  which needs -

September 7, 2010

Analysis…Going thru Terry Laundry Advance /Decline Oscillator readings the Resistance level is about the very top it can reach, and after tomorrow it will move up to a point that it can’t rally to it. Normally, when the Oscillator starts to downtrend it is not big moves in the price and there can be some rally in price even though the oscillator is moving down….The big sell off is when the Support 3 level below is taken out…will watch and see if it plays out that way. ISEEE popped up to 121, we haven’t seen that for awhile and tells me that a lot of people are expecting a relief rally….TRIN is below 2.00 so we still have gas for the downside…I would expect it to make it to Support level One, rest until beige book post..then it may shoot for Support level two.

For Advance – Decline Volume we are looking for

S1 of  20 which needs -520,000.000  this is the uptrend support and could create the first basis for a relief rally

S2 of 5 which needs -820,000,000

S3 of  -45 which needs -1,820,000,000 this is Key Trendline, if that breaks we should sell off fast.

R1 of 130 which needs  1,680.000,000 this is historically the top of the breadth. If it hits, the breadth volume will be declining to lower levels.

For Advance – Decline

Resistances is 300   which needs 1110

Support One is 110  which needs -790

Support two is -50 which needs -2390

September 3, 2010

Analysis..I was simply amazed we pushed it up again..TRIN is now 4 days of super low numbers.

For Advance – Decline Volume we are looking for

S1 of  -5 which needs -1,189,000,000

S2 of -13 which needs AND IS THE BOTTOM TRENDLINE of 1×1 GANN which needs -1,349,000,000

R1 of 81 which needs 531,000,000

R2 of 110 which needs 1,111,000,000

For Advance – Decline

Resistances is 150 which needs 959

Support is - 452 which needs -2241 which would take it to the Zero Line

September 2, 2010

Analysis…HERE IS OUR MOMENT. Heavy resistance, even more then yesterday. We hit our weekly resistance of the SPX at 1090 per weekly article. A wall to  the upside vs just Air below. TRIN is low again, ISEE is still not high which I would like it to be. Market rested today…

For Advance – Decline Volume we are looking for

S1 of  -5 which needs -1,189,000,000

S2 of -13 which needs AND IS THE BOTTOM TRENDLINE of 1×1 GANN which needs -1,349,000,000

R1 of 81 which needs 531,000,000

R2 of 110 which needs 1,111,000,000

For Advance – Decline

Resistances is 150 which needs 959

Support is - 452 which needs -2241 which would take it to the Zero Line

September 1, 2010

Analysis…OK think about driving thru a brick wall, that is the firepower that would be needed to get this market moving up tomorrow. TRIN is .25, We have little up before we hit resistance on the Advance-Decline …support is unlimited. For Advance – Decline Volume it is at resistance…it has to jump to a NEW Gann Angle to continue up…the only thing is that ISEE is not as high as I want it to be so we could rest a bit before we challenge the 610MA on the daily as support.

For Advance – Decline Volume we are looking for

S1 of 4 which needs -502,000,000

S2 of -25which needs AND IS THE BOTTOM TRENDLINE of 1×1 GANN -1,082,000,000

R1 of 61 which needs 638,000,000

R2 of 85 which is the top of the 2 x1 GANN Trendline  1,118,000.000

For Advance – Decline

Resistances is 150 which needs 276

Support is - 452 which needs -5744

August 31, 2010

Analysis..Market had it’s day of rest. There is major fire power to the downside if it can’t hold it’s first support level on the Advance – decline volume. At this point it’s the commodities holding up the market, darn India govt, lol. We have a little bit of gas to the upside but at best, with the low TRIN number and weak F/X… at best we can hope for is a move up to test the first and second resistance…heck we have the Evil 610 MA on the daily chart at 1066.60 ish, lol…no fire power to take that bad boy out with only bte Global PMI’s and a bte Aussie GDP….plus ECB on Thursday won’t let Eur/USD go to far tomorrow…Obama bringing people home already priced in….imho all we are doing right now is resting until we really get going and slam down under 1040 in a big way…the only thing that is getting in my way is those China Billet spots which have risen after India said they had to do more about illegal mining…yet Rebar and Wire are down in China tonight (even with bte on one of china’s PMI’s)….so really a rally without balls imho.

For Advance – Decline Volume we are looking for

S1 of -35 which needs -225,000.000 Which is a Super Important Gann trendline to hold

S2 of -67 which needs -865,000,000

R1 of -20 which needs 75 ,000,000

R2 of -5 which is 50% of the channel and needs 375,000,000

R3 of 12 which needs 715,000,000

R4 of 25 which needs 975,000,000

August 30, 2010

I am TOTALLY amazed, going thru the closing numbers we actually HIT and went just below S2 of -53 to have a closing Volume of -56…..that is what the end of the day push was. So for tomorrow we have two possible markets…One we go back and hold that support line and rally back, that rally back normally hits about 50% of the span of the angle and I have marked that at R2. Our TRIN is 3.82 so we did use a lot of gas, BUT not all of the gas on the sell off. With this Support we also have our 1040 support that is pretty strong. In addition to that the USD/JPY is coming to a point that the BoJ will step in and start buying….yep, one of those MOMENT of the Markets tomorrow. Looking at all our levels a test of R1 is the easiest for the market, yet with FOMC in the afternoon I would doubt it will travel much above it until the data is out. Therefore, looking at these levels, if we open down I would expect a attempted rally to try and test R1 on the advance – decline volume…if it can’t hold we will be moving down into a lower GANN angle and a very KEY support at S2 which is the trendline created by our base pattern last week….could be an interesting afternoon.

For Advance – Decline OMG I was looking for Support at -1500 and we closed at -1670…for tomorrow support is -1497 and resistance is anything positive with the key resistance of 1753

For Advance – Decline Volume we are looking for

S1 of -62 which needs -334,000.000

S2 of -69 which needs -474,000,000

R1 of -41 which needs 86,000,000

R2 of -20 which is 50% of the channel and needs 506,000,000

R3 of 5 which needs 1,006,000,000

August 27, 2010

Tomorrow is really going to be a test of Gann Angle’s, so far (when I do the math right) the Adv – Decline Volume has been following them. For tomorrow, For Advance – Decline of the NYSE I will be looking for Resistance at +500 and support -1500 if either are broken we could get a major move. Are closing TRIN was very low and we moved a great deal so normally with little gas to the upside is seen, we should expect a sideways movement or test of the Support levels below…we will see.

For Advance – Decline Volume Levels, I have 3 resistance and 3 support. If I am correct in the degree of the Gann Fan Angle we will be testing the support levels. If the trend is running at the degree angle above it the resistance levels should be tested.

As you know I have been screwing up with my Math. I know the Levels, it’s just the solving for X or Volume needed that has been causing me problems…so use with caution cuz this is still in beta testing

This is the formula I used which was just a little different from Fridays (second set of brackets), let’s see if it works

(-98(.90) + x)-(-71(.95) +x(.50))= Support or Resistance levels

S1 + -385,000.000

S2 -845,000,000

S3- -1025,000,000

IF any of these support levels are tested we know that we are sitting in the 45 degree to 63.75 degree Gann Channel uptrending

R1 =215,000.000

R2= 715,000.000

R3 =875,000,000

IF these are the levels tested the uptrend is moving in the 71.25 degree channel and is much stronger a uptrend.

August 26,2010

Analysis..For the Advance – Decline, -1184 First Support S1 for Advance – Decline THIS IS A BIG SUPPORT SPOT
-2184 second support S2.Resistance is 1016………For Advance – Decline Volume,

August 25, 2010

Analysis…After I did my calculations we still ended up at a support level but my original math was off….to rememdy this I have stopped doing it by hand, the nice part is that I am going to get a very specific points…the calculations will even be better once I get the graphs at even  more percise now that these trends are playing out…….For tomorrow for Advance – Decline = S1 is -2050. S2-3150…………………….R1 is still above to cause any resistance…For Advance – Decline Volume it’s S1 is -153,400,000, S2 is neg  -200.000.000…R1 is 113, 400.000 and R2 is 313,400,000………..even though the futures are up and we did touch that lower support that I indicated in my weekly article we are still downtrending in the Advance – Decline Volume Oscillator so we have failed to make a bottom yet for recovery…in addition we are at a downtrend support line but there is a key support that should be tested at support 2 still….TRIN is lower, which sets up for a down day after we rested…we will see.

Advance minus decliners     685

Up Volume minus Down Volume   156.000.000

ADO (Advance Decliner Oscillator)  =-150

18 Vol  = -171   36Vol = -67       Total -109

TRIN 1.18

August 24, 2010S

Analysis..Well, we got our sell off that I was looking for last night. Yet, we still haven’t touched that support yet. For tomorrow our Support for the Advance – Decline of S1 -1220 S2 -1820…for resistance it’s over plus 3000 so basically there is no resistance. For the Advance – Decline Volume the Support is -500.000,000 for S1 and S2 -800,000,000………Resistance +200,000,000…..TRIN is moving higher being over 2.00, but we have the gas still to test that Support we are moving to….so tomorrow will be like today but watch for the ability to actually hit that support and attempt a rally.

Advance minus decliners     -1583

Up Volume minus Down Volume   -860.000.000

ADO (Advance Decliner Oscillator)  =-242

18 Vol  = -208   36Vol = -113       Total -95

TRIN 2.10

August 23, 2010

Analysis…THIS is going to be one of the KEY test of my education on how this moves, we are in a position to go either way with support and resistance close to even….BUT I have noticed that GANN Angles  seem to like to touch the bottom support before it moves up when it is in a GANN ANGLE downtrending…if that is the case I would expect it to touch support levels before a resistance is tested on the Advance – Decline , even though SPX will probably want to retest the 1069ish range of the 610Ma on the Daily before we move down. For tomorrow Support is approx -1,000,000,000 of Advance- Decline Volume…. For Resistance, R1 Just anything positive R2 +100,000,000 R3 +2,800.000,000………..BUT!!! For Advance – Decline For TOMORROW Support on this is SO STRONG and I will be watching for a test of it before a REAL rally attempt, That is a Support of Advance – Decline of -2670…Resistance is +2830………… THIS IS A TEST OF A GANN KEY CROSS of down and uptrendline for the support……………So I am looking for a big drop tomorrow or the next day to test that Advance- Decline Support before we attempt a rally, The low TRIN givew us Gas for that if we want to…..Plus the Power of the Evil 610MA on the Daily is MADE for these wild moves…..yet with the VXX being down, I still won’t be surprised if Amature Hour will attempt a rally before slapped down hard….can’t wait to see..

Advance minus decliners     -786

Up Volume minus Down Volume   -271.000.000

ADO (Advance Decliner Oscillator)  =-93

18 Vol  = -136   36Vol = -74       Total -62

TRIN 1.24

August 20, 2010

Analysis..As you can see we closed right below the S2 of  400.000.000 on the volume. At this point my graphs are pretty crude so this is very close still. For Monday, for the Advance- Decline Volume it should have S1 at -800,000,000 and S2 at -1.200.000.000 whith resistance at 1,300,000,000………….for the Advance – Decline Support is at -2860, with R1 at 140, R2 at 1140 and R3 at 1640. Tomorrow is really a coin flip, we are opening right at support and even with the TRIN lower and more resistance to push it up..the market could try because it is Monday and normally bullish cuz of the Fund Managers being in it….but flip a coin, those are the odds on little econ data and at such a key support level that it must hold for the Advance- Deline Volume. BTW, I was messing around with this thesis over a period since 1987 and it has lined up perfect….this could be really interesting as I continue to beta test it.

Advance minus decliners     -488

Up Volume minus Down Volume   -469.000.000

ADO (Advance Decliner Oscillator)  =115

18 Vol  = -121   36Vol = -64       Total -59

TRIN 1.77

August 19, 2010

Analysis..OK we went thru support today nicely and tomorrow we have either a retest of that support or a continued freefall. TRIN is up to 2.85 and ISEE is 72…the TRIN is not super super high and ISEE is not super super low so we still have some gas in the tank if we want to continue the downtrend. For tomorrow Support Levels, Advance – Decline Volume = S1 -100,000,000 (VERY IMPORTANT ONE) S2 -400,000,000  S2-750,000,000 For Resistance it just needs to have a positive number, R2 1,000,000,000……….For Advance – Decline = S1 -2840 R1 340…………….So for tomorrow, because the Advance – Decline has alot  more room to the downside and Advance – Decline Volume has such a key Support level so close,  I would assume we test that support and if we can take on S1 on Adv/Decline Volume we can continue our downtrend nicely.

Advance minus decliners     -1886

Up Volume minus Down Volume   -900

ADO (Advance Decliner Oscillator)  36

18 Vol  = -83   36Vol = -43       Total -40

TRIN 2.85

August 18, 2010

Analysis…Double check my math today. We are still under the trendline resistance of the Adv-Decline Volume but pushing right up to it. Today the highest was around 260,000,000 which we then pulled away from and we closed around 252,000,000. We went above a downtrend line on the Adv – Decline and now have that as support. So for tomorrow, Adv- Decline Volume first resistance is at 65,000,000 and the second one is at 500,000,000. The Advance – Decline just needs to hold support of -250 or higher. TRIN is low again at .80, yet ISEE is also not that strong yet at 100………Support on the downside is -700,000,000….So again, the upside has heavy resistance at 65,000,000…if it takes it out it could move strong, but with TRIN weaker the gas imho is still not there at all…..sorry again for my 30,000,000 vs the true number 300,000,000.

Vol = 6

TRIN = .80

Advance minus decliners     520

Up Volume minus Down Volume   252

ADO (Advance Decliner Oscillator)  252

18 Vol  = 8   36Vol = 2       Total

August 17, 2010

Analysis….Tomorrow Resistance level is advance – decliner = 200,  Advance – Decliner Volume = 30,000.000 ……Support adv – decliner = -1500, Adv – Decliner = -500.000.000……….Trin is Low, We have heavy resistance at 1101, ISEE I wish was higher…but there is a lot more room to the downside and little left for a gain and no firepower to take out the heavy resistance at this point….So we could sit and try to build strenght for a later attempt or just give up and go test support. A lot will have to do with how China trades tonight…but the way it pulled back today it seems the downside is favored.

Advance minus decliners     1774

Up Volume minus Down Volume   657

ADO (Advance Decliner Oscillator)  222

18 Vol  = -19   36Vol = -11       Total Vol = -8

TRIN = .72

August 16, 2010

Analysis..This is one hard one to call. Plotting the total Volume number (below) for months I was able to establish that it formed a GANN 7.5 degree support for the last few days on a recent low. I thought today we would break that support and test the GANN angle from the recent high, but that didn’t happen…instead it closed on another downtrend line from the recent highs. For tomorrow we could free fall to that lower trendline I am watching in a super big drop or go into a maze of trendline resistance to attempt to move up. At this point the ADO is positive and the TRIN and ISEE support a move up. Therefore the odds are for an attempted test of resistance for tomorrow…but there is little upside so it will be a very hard fight for those points.

Advance minus decliners     747

Up Volume minus Down Volume   22

ADO (Advance Decliner Oscillator)  50

18 Vol  = -95   36Vol = -46       Total Vol = -49

TRIN = 1.56

August 13, 2010

Analysis..Monday and Tuesday  is really going to test my understanding how this indicator works. With the low ISEE there will be a strong push to start a rally today. Yet, I would like to see a test of a lower point that could only occur if Advance – Decline VOLUME equals -275,000,000 or less on the NYSE. If we rally tomorrow I would be looking for resistance of Advance -Decliner VOLUME of 860,000,000 or more. I really want to see the test of support of the lower line on Monday or Tuesday before an attempted rally is started….we will see.

Advance minus decliners     -246

Up Volume minus Down Volume   -172

ADO (Advance Decliner Oscillator)  -28

18 Vol  = -109   36Vol = -49       Total Vol = -58

TRIN = 1.21

August 12, 2010

Analysis..Tomorrow is going to be one of those moments of truth for the market. We closed right on the Trendline of the A/D ala Nymph and moved down just a little bit on the Vol A/D Osc. Our TRIN is neutral and so is our ISEE. Firepower to go either way, flip a coin. I can’t tell whether we rally and take out the Vol A/D down trendline for a attempted recovery rally for two weeks or we move down to get support in the 1056ish range….too hard of a call.

Advance minus decliners     -427

Up Volume minus Down Volume   -239

ADO (Advance Decliner Oscillator)  -3

18 Vol  = -102   36Vol = -44       Total Vol = -58

TRIN = 1.23

August 11, 2010

Analysis…OK we got the huge sell off and the A/D ala Nymph is within range to test it’s trendline, if we have a Advance – Decline of about -500 on the NYSE we will hit it. BUT if we attempt a rally we will have problems of resistance on the trendline of the Volume Advance – Volume of Decline which can move up with only a +500.000,000 before hitting it…holding that resistance will give us the firepower to continue a move down on Friday or next week. So for tomorrow I would expect to see a test of the low side and a attempt to move up, hitting around 1096ish should give us a retest of the A/D Volume resistance and we should probably close around that range. With TRIN over 6 it may very hard to take out our ADO support…market really needs to rest to continue it’s push down…retest of 1101ish probably interday.

Advance minus decliners     -2205

Up Volume minus Down Volume   -1103

ADO (Advance Decliner Oscillator)  44

18 Vol  = -87   36Vol = -34       Total Vol = -53

TRIN = 6.31

RANDOM T THEORY NOTE….I WANT TO STUDY THIS LATER…from T Theory Foundation “Hi Terry   I caught your comments about the adaptive channel that I was asking about. I’ve changed my central EMA to a 56 EMA and I have managed to get something similar for the bands using a Keltner channel (Which is basically a Average true range channel). If I set the bands at 4 ATR above and below the 56 EMA it works pretty well and contains most of the highs and lows. I note that as of today my upper band is 18 points higher that yours. Thanks for letting me know about the 56 EMA. That helped heaps. Its a really great system. I’ve attached a chart for you to see.   Alan”…..Terry says more like 60 ema.

August 10, 2010

Analysis…We closed right on support of the a/d ala Nymph line and the Terry Laundry Vol Osc is just short of hitting zero. ISEE is low but so is TRIN…at this point we could have every one of the NYSE decline and we still won’t hit support. If we want to, we can fall like crazy tomorrow and at least finally test that SPX 1101 I am waiting on.

Advance minus decliners     -1496

Up Volume minus Down Volume   -566

ADO (Advance Decliner Oscillator)  293

18 Vol  = 24   36Vol = 20       Total Vol = 4

TRIN = 1.41

August 9, 2010

Analysis..Yesterday the Mutual Fund Monday Group ran all around and failed to respect the Resistance trendline and closed above it. It is now at a level with no upside, huge downside and FOMC and BoJ rate desisions which all the good news is already priced into the stock. Fly called it a coil spring. I loose my internet for 1/2 a trading session an the Fund guys make such a mess. ISEE is higher, not as high as I would like, TRIN is low, would like it lower..yet tomorrow we are going down.

Advance minus decliners     1356

Up Volume minus Down Volume   332

ADO (Advance Decliner Oscillator)  480

18 Vol  = 90   36Vol = 52       Total Vol = 38

TRIN = 1.04

August 6, 2010

Analysis. We will open with us sitting on a Trendline of a/d ala Nymph that if we move down we could fall pretty fast. We retested that trendline after going below it on Friday. If we attempt a rally, at best the Advance-decline of the NYSE could be 1250 before it hits the resistance of the first trendline that we went thru on Friday. ISEE is low, TRIN is neutral, the A/D volume is already in a decline. Monday could be the last attempt for the bulls to keep this rally from July 16 from fading pretty hard.

Advance minus decliners     -233

Up Volume minus Down Volume   -288

ADO (Advance Decliner Oscillator)  386

18 Vol  = 63   36Vol = 35       Total Vol = 28

TRIN = 1.62

August 5, 2010

Analysis: All or nothing, we are right at the trendline I am watching, any neg advance/decline breaks it…so close. Would like to have ISEE higher. NFP could really take it out.

Advance minus decliners     -467

Up Volume minus Down Volume   -147

ADO (Advance Decliner Oscillator)  454

18 Vol  = 102   36Vol = 56       Total Vol = 46

TRIN = 1.04

August 4, 2010

Analysis: We still haven’t broken the trend line that I am watching of the Advance/Decline Oscillator. we would to see  a advance- decline = -720 to break it. ISEE is higher tonight so it could help us if we break the trend. On the upside, at best we can get  something like today…it is at a very high range which again favors a down day…but until the trendline is broken the bulls remain in control.

Advance minus decliners     1519

Up Volume minus Down Volume   364

ADO (Advance Decliner Oscillator)  557

18 Vol  = 130   36Vol = 66       Total Vol = 64

TRIN = 1.32

August 3, 201o

Analysis; We are right on the A/D Oscillator trend level tomorrow, any decline could really get some firepower. With the Advance/Decline Volume already below the trend a chance of a up day will be very difficult at best. ISEE is still low which is the only thing that could not give us super charged sell off, sell off yes, but not so powerful tomorrow.

Advance minus decliners     -778

Up Volume minus Down Volume   -403

ADO (Advance Decliner Oscillator)  444

18 Vol  = 105   36Vol = 52       Total Vol = 53

TRIN = 1.53

August 2, 2010

Analysis: Today the A/D oscillator held support and had a major move up. It only can handle about a Advance -Decliners of about 100 before it totally tops. Volume is hitting resistance. With TRIN being only .38 and everything near resistance, everything favors a down day tomorrow. The Advancer – Decliner would have to more then -1100 to take out support and kick in the bots. ISEE is weak so we not get the strong move down, but it is coming.

Advance minus decliners     2242

Up Volume minus Down Volume   890

ADO (Advance Decliner Oscillator)  580

18 Vol  = 161   36Vol = 75        Total Vol = 96

TRIN = .38

July 30, 2010

Analysis: We have had a nice slow movedown last week and we are so close to a key support level that should trigger the bots into a downtrend sell mode. I am looking for a Advance minus decline level of a mere -60. Not much at all. If it could hold below that clean we should see the 1097 support level we have had to turn to a resistance point for the rest of the week. The bulls are strong and have been fighting this one with everything they got. But, with Window Dressing over and a Passive F/X funds not needing to buy the Euro and Aussie today a lot of that firepower is gone. And the nice part. Because the move down has been so slow the bears have a lot of firepower to the downside this week……One note, I did a couple of minor math errors, I mixed up 2 numbers when posting Thursdays numbers. My own notes were correct, I just wrote them wrong here.

Advance minus decliners     540

Up Volume minus Down Volume   92

ADO (Advance Decliner Oscillator)  396

18 Vol  = 80   36Vol = 31        Total Vol = 49

TRIN = 1.22

July 29, 2010

Analysis= Tomorrow is going to be a lot more harder to call. When I saw the sell off in the close, I though Advancers to decliners would be neg, but they remained positive. We are now dealing with a much harder ISEE number and the bulls knowing we tested 1096. Our Volume in the Advance/Decline has dropped so that tells me that big money is taking profits, BUT we are coming to a key test of support of the A/D without as much firepower as I had hoped, it could catch and attempt a rally to about 1115ish, which is really hard for it to do, but until the last hold outs give up we won’t get our nice sell off at all. We favor a continued move down but we could get caught around the 1096ish level until we can get a good move of the advance/decline to the downside…omg, people have no panic at all about them.

Advance minus decliners     164

Up Volume minus Down Volume   -112

ADO (Advance Decliner Oscillator)  381

18 Vol  = 78   36Vol = 28        Total Vol = 50

TRIN = 1.36

July 28, 2010

Analysis= Well today we felt the advance/decline Vol Oscillator drop under support, but it was able to regain it’s support level to close right at that level. The Actual advance/decline numbers are still pretty far from their support level. In a perfect world I would love to see the advance/decline vol to remain flat but the actual number of advance-decline number to fall. If it did that we would have a lot of firepower to take it down hard. Yet, not a perfect market…so at this point our ISEE at 182 and volume advance/decline able to easily break support, I could see a really down day tomorrow….but if it is, the TRIN would be over 5 at the end of the day and we would have pushed it down as hard as it could go, which would set up for a nice relief rally in the 1096ish range when GDP comes out….So for tomorrow, I would actually like to see the perfect world option…but I know it could be the big smack down. It is rather fustrating because if we can really have another day like today we could really slam this thing down beyond the 1096 level…oh well, we will see. For upside, two major resistance levels on the vol advance/decline that it would need Obama giving out free money to rally this thing, imho. We will see.

Advance minus decliners     -361

Up Volume minus Down Volume   -470

ADO (Advance Decliner Oscillator)  -1031

18 Vol  = 100    36 Vol = 36        Total Vol = 64

TRIN = 1.39

July 27, 2010

Analysis= We still favor a flat to down market tomorrow. We can’t really get a huge move down yet, even though the advance/decline volume is coming up to some key support. .If China does sell off tonight, I would expect a push down but a recovery from an all out free fall at this point. We also have little to no fire power to the upside either tomorrow, at best we could possibly see a advance minus decline volume of  100,000,000 or so before hitting resistance…so it really is looking for another dull day, but be careful with the Steel stocks, X knocked them down today but China could give it a much harder blow if the buyers don’t come soon to these high moves in Offer prices that we have seen over the past week in spot prices.

Advance minus decliners     -361

Up Volume minus Down Volume   -128

ADO (Advance Decliner Oscillator)  564

18 Vol  = 163     36 Vol = 62         Total Vol = 101

TRIN = 1.00

July 26, 2010

Analysis= Today we saw a huge number in the Advancers vs Decliners, but the Volume did not follow thru, ISEE is still low and TRIN just has it’s first day of below 1.00. Therefore I would expect to see a continued decrease in Volume to the upside and because of the high reading of the ADO I would expect it to start to move down. Yet, we won’t see any major downside move until ADO falls to under 100 or so. So putting everything together I would expect slightly down tomorrow, which as I indicated in my weekly view, I would expect it to start around the 1pm auction.

Advance minus decliners     1870

Up Volume minus Down Volume   753

ADO (Advance Decliner Oscillator)  669

18 Vol  = 195    36 Vol = 72         Total Vol = 123

TRIN = .60