Awaiting Next Quality Set-Up

Our Bayesian Signal Alerts service cashed out of its longs in indices at nearly exactly these levels last week. One more low below the Sep 23 low in the SPDR S&P 500 ETF (SPY) is still expected to set up the ideal risk-return trade.  

There has been mostly micro chop for over a week now, and the two clusters still impacting price are 308-312 above [Probability=42%] and 292-296 below [P=58%].  

Our Bayesian Timing System patiently awaits another quality risk-return setup from a swing trading perspective (that’s a 1-3 week hold for new members).  I will continue to carry this forward as something to put on your radar: For SPY, a deep hole begins below 290 and has paths as deep as the 240s – my interpretation of this is that if 290 is breached, then watch the eff out!

In metals, the bulls and bears continue to have fun micro punching each other, with no discernable trend as of yet.  Lower levels are still considered the most likely outcome.  In GDX there are support clusters in the 23-25s and in GLD 133-135, and probabilities of 68% support seeing those levels before this correction runs its course.

In oil, the USO continues to bleed off of the top from last week and with a vibration window (VW) showing up this week, we may finally get our entry into another swing trade.  For those bullishly inclined ideally this week’s VW is a low and the one in November represents a high from a multi-week perspective.  There are probability clusters at 11.50-11.75 on the downside and 12.5-12.75 overhead. 

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Luke Miller, who has developed a Bayesian timing system for trading the stock market, hosts two Bayesian timing premium services at ElliottWaveTrader.