Tuesday, November 17, 2009

Math and the SPX

Reproduced from Steven Rock at the crystal ball group

After the SPX ATH of 1552.87 was reached on March 24th, 2000, the SPX declined until April 14th and then rallied to what some call a failure top of 1530.09 on September 1st 2000.

One of the reasons that the September top has importance in the mathematical structure of the index is the fact that 769 calendar days from and excluding 9/1/00, the SPX hit its October 2002 low OF 769! (768.83)

This drop of 761.26 points took 526 trading days (excluding 9/1) since the market lost 4 trading days due to 9/11.

It turns out the market may be revisiting these numbers as we work through November 2009.

Counting 769 calendar days from and excluding the Ocober 11th 2007 top, we reach November 18th, one of the reasons I have called for a CIT on 11/17+/-1.

But I may have outsmarted myself, because counting 526 TRADING days from the '07 top yields November 11th. The SPX reached 1105.37 on 11/11, exactly in the middle of my target of 1105+/-5.

What is really interesting, though, is the phi relationship of the '00-02 drop to this '07-'09 move.....

1530.09-768.83 = 761.26
1576.09-1105.37 = 470.72

761.26/470.72 = 1.617

Also, the ROC of price over the '07-'09 move is 470.72 points over 762 calendar days which is .618 pts/day!

And note how the price drop in the '00-'02 move (761.26 pts) and the calendar days of '07-'09 (762) are practically identical.

Still, this week should be important. The market has so many relationships to fulfill that we are in store for extremely interesting price-time action.

more later

1 comment:

Red Dragon said...


I wish we would "Get There" (in response to your previous post titled "Are we there yet?").

I'm certain tired of the obvious manipulation of the tanking of the dollar to keep this market afloat.

Take the dollar out of the picture and forecasting the market would be a whole lot easier!

Just my 2 cents. Sorry I don't drop by more often, but I'm really busy this time of year. I do secretly read your posts from time to time. Shhhh... don't tell anyone.