Google - Gann Time & Price Analysis

Click on Image to Enlarge

Google is currently at a key technical resistance of $566.61. If this level holds as resistance going into March 12, 2010 then a series of significant declines can be forecasted. The first target for the decline is $496.88. In the earliest scenario, April 2, 2010 is the projected date when price is expected to meet 496.88

If 566.61 does not hold as resistance then price is expected to reach 590.66 by April 2, 2010.

Additional Support & Resistance Levels:

S1= 496.88

S2= 460.42 - Time Target= 07/05/2010

S3= 411.71

---------------------

R1= 566.61

R2= 590.66

R3= 615.21

-----------------------

Important dates on which price could meet the following price targets:

1) March 12, 2010

2) April 2, 2010

3) April 20, 2010

4) May 7, 2010

5) May 28, 2010

6) June 15, 2010

The dates listed above have not been derived from Planetary Degree Dates and are therefore unique to Google's stock.

Dow Jones 1997-2010

Click on Image to Enlarge

The following chart displays a 13 year view of the Dow Jones Industrial Average with Planetary Degree Days overlayed. I have indicated degree days for Saturn, Uranus, and Jupiter. Most notable are the degree days of Saturn. In most cases, Saturn Degree Days do not occur at exact highs/lows. Their occurrence however, does signal the beginning phase of a powerful price move which lasts for several years.

Silver ETF Degree Days

Click on Image to Enlarge

This chart displays the daily progress of the Silver ETF with important degree days indicated. For Silver I have decided not to use Mercury as was the case with the GBP/USD. There are fewer subdivisions within the price of Silver so a planet with a slower heliocentric orbit is needed.

Silver met a major low when Venus was at 300 degrees heliocentric longitude. A full rotation from the low brings us back to Venus at 300 degrees. With this in mind, I have highlighted the dates of when Venus completed rotations of 360 and 720 degrees from the low. These dates marked important turning points for Silver and they share price characteristics. It is well known that Gann believed history repeats itself. It is my conclusion that this evidence of repetition is what Gann was referring to.

--------------------------------

The first decline from the 300 degree day was $3.51 (high to low). The initial rally which occurred from 360 degrees was $2.53

The second decline from the 300 degree day was $3.55 (close to close). The initial rally which has occurred from 330 degrees is thus far $2.4

--------------------------------

If this pattern of repetition was to continue, then the forecast resulting from this analysis would surely go against my previous bearish interpretation. The repetition of the past scenario would indicate that there is going to be short term weakness in Silver. Price is expected to drop leading up to a March 16th Bullish Reversal. The rally from March 16, 2010 would result in a new 52 week high by April 2, 2010. A trading strategy of "Protected Shortsell" could be implimented until bullish scenario is eliminated. Short the stock + Buy April Call.

My argument against the repetition scenario results from the recent occurrence of other planetary degree days. In this chart we can also see that Jupiter completed a 30 degree rotation during the entire time that it took for Silver to make its upward journey. Although Jupiter's degree days did not occur exactly at the low or high, it is obvious that those days encompass 99% of the Silver rally. I am trading with the belief that the recent Jupiter degree day marked a major turning point for silver. The decline in Silver is expected to continue until the next the next Jupiter degree day of November 9, 2010. Since price tends to reverse on these degree days, a decline into one indicates price rally, and a rally into a degree day indicates price decline. For the bearish forecast to remain strong, I am looking for price to remain sideways to slightly higher until March 16 and possibly reach my second cluster target of 17.74-17.98.

For the previous Silver chart visit www.1618analytics.blogspot.com

GBP/USD Planetary Degree Days

Click on Image to Enlarge

The following chart displays important degree days for the GBP/USD. I only tracked the days which fall at every 30 degrees heliocentric longitude. For a planet like Mercury which moves fast, its 30 degree interval days will occur more often than other planets further away from the Sun.

It can be argued that since important degree days for Saturn, Jupiter, and Mars occur less often, thier occurrence will mark very important turning points. Confluence dates occur when several planets arrive at important longitude degrees within several days of each other. Perhaps being aware of major confluence dates was the goal of WD Gann since he mentioned that he kept 360 degree calenders for all the planets.

It is visible that the accuracy of planetary degrees as indicators of turning points is mixed. Many of the degree days did infact mark major turning points, while others were ignored or occurred several days late/early. In any case, being aware of these dates can assist the Elliott Wave trader because we could look for "Wave Termination" around these dates. Also, if you use Oscillators; degrees days could give you an indication of when to initiate on the Sell or Buy signal generated.

I have noted the degree interval on significant turning points. The only bearish pattern I can discern is that major highs occur at 210 and 240 Degrees. The bullish pattern would indicate that significant lows can be expected at 120 and 300 degrees.

Silver ETF - Daily

Click on Image to Enlarge

The following chart displays the daily progress of the Silver ETF (SLV). There are 2 key price regions where there is a cluster of 3 resistance levels.

Cluster 1 = 16.99, 17.08, 17.17

Cluster 2 = 17.74, 17.87, 17.98

--------------------------------

Extensive use of the Gann Square of 9 dates are used in this chart. The red vertical lines mark the dates that are 22.5 degrees from 2/12/2009. You will see how the wave structure terminates at or near indicated dates. The rally in question labeled (2) has not respected the termination date of 27/02/2010. Since there has been 5 trading days since this time target, the silver bears can arrive at two possibe conclusions:

1) Wave 2 termination will not occur until the next time target of 22/03/2010

OR

2) A significant Gann price target was not met until today so the cycle extended itself by several days. Thus a drop should ensue immediately.

--------------------------------

The declination indicator at the bottom of the chart supports the second conclusion. We see the first wave count of (1), (2) terminate relatively close to max declination. If wave (2) of 3 terminates on 22/03/2010, this would be a half cycle of declination devoted towards a "corrective wave." Since a rally termination on 22/03/2010 would result in a longer declination cycle devoted towards upward price action it would create the argument that the trend has not switched to down.

Here are the key reversal dates to watch:

1) 22/03/2010

2) 14/04/2010

3) 07/05/2010

Price Targets:

1) $13.40

2) $11.89

Bearish Negative Divergences

Click on Image to Enlarge

This chart displays an inter-market analysis viewpoint that technical traders should be aware of. The first data point to consider is labeled "A." Here we see the EUR/USD and GBP/USD peak and negatively diverge with the Dow Jones and Xinhua index. Historically, the GBP and EURO have shared a high degree of positive correlation. The breakdown of this currency/index correlation indicates major market weakness for the most recent leg of the index rally.

The data point labeled "B" displays another negative divergence for the currency/index relationship. The EUR/USD AND GBP/USD both make lower highs when the Dow Jones makes another new high. Also at point "B", we see the Chinese Xinhua Index make a lower high against the Dow Jones Index. The Xinhua divergence is the next major sign of weakness. This breakdown of the global index correlation is a bearish technical signal which should not be ignored. If the Dow Jones does make a new 52 week high, a continuation of the bearish Xinhua divergence is expected. I would look for Brazil, Russia, or India to negatively diverge with a new Dow Jones leg higher. A wider spread negative global index divergence would additionally confirm a strong bearish outlook for the months ahead.

Chinese Xinhua Index ETF (FXI)

Click on Image to Enlarge

The following chart displays the weekly progress of the Ishares Xinhua China Index ETF. It is possible to also trade this decline through buying the Pro-Shares Ultra-short Xinhua China ETF (FXP).

This analysis indicates the possibility of a 43% decline for the Chinese Index ETF. This decline is expected to terminate at $23.26 during Early November 2010. I began by using the date of 29/10/2004. Then I looked at every date that is 360 Degrees from this starting point. The vertical dashed lines display when these dates occur.

The wave count is indicated by Gann and Fibonacci price targets. For the first decline labeled (A) (B) (C) we see the following price relationships:

*(A) is equal to 360 Degrees down from $72.82
*(C) is equal to 720 degrees down from $72.82 & it is 100% times (A)
------------------------
*The large upward rally with the primary label of B retraces exactly 50% of the previous decline.
--------------------------
This ETF has a good history of following the declination indicator located at the bottom of the chart. If this relationship continues, it re-asserts the bearish outlook for the Xinhua Index.