Another Important Stock Market Inflection Point Approaching
Stock-Markets / Stock Markets 2015 Feb 24, 2015 - 03:35 PM GMT
The rally may be over, or nearly so. The sideways consolidation appears to be a sub-Minute Wave (iv) and Wave (v) of [v] also appears completed now.
Even the Fed has sent a warning, saying that equity valuations appear stretched and P/E ratios are somewhat elevated. They may wish to talk the market down, however, since treasury bonds are in a corrective mode and they are probably hoping that this is not the beginning of a new trend.
Here is the long Cyclical view since 1990. Should we see the turn today, a 12.9 market day decline (17.2 calendar days) would take us near the close on March 13, which is exactly 6.01 years from March 9, 2009. March 23 is another important date, since it will have been 314.16 weeks (6.04 years) from March 9, 2009. Something to consider. Should the market turn today, we could easily see March 13 as a breakout low with a retracement high on March 23.
TNX has broken down this morning, giving us a good indication that big money is flowing back into treasury bonds. I marked Friday’s high as Wave (v) even though it was lower than a few days prior for two reasons. First, the decline from 21.52 was not impulsive, which it should have been. Second, Friday was the turn date and a truncated wave would make sense on that date.
Gold may be completing a Master Cycle low today, 8.6 days later than the usual 258 days. We may expect to see a 2-3 week bounce to 1229.80 – 1246.80. It may offset the decline in equities, so stay alert to the possibility. Treasuries and gold share many of the same pivots at this time, but don’t expect quite the same reaction in gold as in treasuries.
Crude oil, on the other hand, appears to be ready to join equities in the decline.
I’ve been up most of the night, flying back from the West Coast. I’ll try to comment later as I see changes happening.
Regards,Tony
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