Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
How to Trade Binance Vanilla Options for the First Time on Bitcoin Crypto's - 2nd Aug 21
From vaccine inequality to economic apartheid - 2nd Aug 21
Stock Market Intermediate Top Reached - 2nd Aug 21
Gold at a Crossroads of Hawkish Fed and High Inflation - 2nd Aug 21
Bitcoin, Crypto Market Black Swans from Google to Obsolescence - 1st Aug 21
Gold Stocks Autumn Rally - 1st Aug 21
Earn Upto 6% Interest Rate on USD Cash Deposits with Binance Crypto Exchange USDC amd BUSD - 1st Aug 21
Vuze XR VR 3D Camera Takes Near 2 Minutes to Turn On, Buggy Firmware - 1st Aug 21
Sun EXPLODES! Goes SuperNova! Will Any planets Survive? Jupiter? Pluto? - 1st Aug 21
USDT is 9-11 for Central Banks the Bitcoin Black Swan - Tether Un-Stable Coin Ponzi Schemes! - 30th Jul 21
Behavior of Inflation and US Treasury Bond Yields Seems… Contradictory - 30th Jul 21
Gold and Silver Precious Metals Technical Analysis - 30th Jul 21
The Inadvertent Debt/Inflation Trap – Is It Time for the Stock Market To Face The Music? - 30th Jul 21
Fed Stocks Nothingburger, Dollar Lower, Focus on GDP, PCE - 30th Jul 21
Reverse REPO Market Brewing Financial Crisis Black Swan Danger - 29th Jul 21
Next Time You See "4 Times as Many Stock Market Bulls as There Are Bears," Remember This - 29th Jul 21
USDX: More Sideways Trading Ahead? - 29th Jul 21
Waiting On Silver - 29th Jul 21
Showdown: Paper vs. Physical Markets - 29th Jul 21
New set of Priorities needed for Unstoppable Global Warming - 29th Jul 21
The US Dollar is the Driver of the Gold & Silver Sectors - 28th Jul 21
Fed: Murderer of Markets and the Middle Class - 28th Jul 21
Gold And Silver – Which Will Have An Explosive Price Rally And Which Will Have A Sustained One? - 28th Jul 21
I Guess The Stock Market Does Not Fear Covid - So Should You? - 28th Jul 21
Eight Do’s and Don’ts For Options Traders - 28th Jul 21
Chasing Value in Unloved by Markets Small Cap Biotech Stocks for the Long-run - 27th Jul 21
Inflation Pressures Persist Despite Biden Propaganda - 27th Jul 21
Gold Investors Wavering - 27th Jul 21
Bogdance - How Binance Scams Futures Traders With Fake Bitcoin Prices to Run Limits and Margin Calls - 27th Jul 21
SPX Going for the Major Stock Market Top? - 27th Jul 21
What Is HND and How It Will Help Your Career Growth? - 27th Jul 21
5 Mobile Apps Day Traders Should Know About - 27th Jul 21
Global Stock Market Investing: Here's the Message of Consumer "Overconfidence" - 25th Jul 21
Gold’s Behavior in Various Parallel Inflation Universes - 25th Jul 21
Indian Delta Variant INFECTED! How infectious, Deadly, Do Vaccines Work? Avoid the PCR Test? - 25th Jul 21
Bitcoin Stock to Flow Model to Infinity and Beyond Price Forecasts - 25th Jul 21
Bitcoin Black Swan - GOOGLE! - 24th Jul 21
Stock Market Stalling Signs? Taking a Look Under the Hood of US Equities - 24th Jul 21
Biden’s Dangerous Inflation Denials - 24th Jul 21
How does CFD trading work - 24th Jul 21
Junior Gold Miners: New Yearly Lows! Will We See a Further Drop? - 23rd Jul 21
Best Forex Strategy for Consistent Profits - 23rd Jul 21
Popular Forex Brokers That You Might Want to Check Out - 22nd Jul 21
Bitcoin Black Swan - Will Crypto Currencies Get Banned? - 22nd Jul 21
Bitcoin Price Enters Stage #4 Excess Phase Peak Breakdown – Where To Next? - 22nd Jul 21
Powell Gave Congress Dovish Signs. Will It Help Gold Price? - 22nd Jul 21
What’s Next For Gold Is Always About The US Dollar - 22nd Jul 21
URGENT! ALL Windows 10 Users Must Do this NOW! Windows Image Backup Before it is Too Late! - 22nd Jul 21
Bitcoin Price CRASH, How to SELL BTC at $40k! Real Analysis vs Shill Coin Pumper's and Clueless Newbs - 21st Jul 21
Emotional Stock Traders React To Recent Market Rotation – Are You Ready For What’s Next? - 21st Jul 21
Killing Driveway Weeds FAST with a Pressure Washer - 8 months Later - Did it work?- Block Paving Weeds - 21st Jul 21
Post-Covid Stimulus Payouts & The US Fed Push Global Investors Deeper Into US Value Bubble - 21st Jul 21
What is Social Trading - 21st Jul 21
Would Transparency Help Crypto? - 21st Jul 21
AI Predicts US Tech Stocks Price Valuations Three Years Ahead (ASVF) - 20th Jul 21
Gold Asks: Has Inflation Already Peaked? - 20th Jul 21
FREE PASS to Analysis and Trend forecasts of 50+ Global Markets by Elliott Wave International - 20th Jul 21
Nissan to Create 1000s of jobs with electric vehicle investment in UK - 20th Jul 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stocks Bull Market Continues

Stock-Markets / Stock Markets 2012 Jan 23, 2012 - 03:11 AM GMT

By: Tony_Caldaro


Best Financial Markets Analysis ArticleThe US rally extends to three up weeks in a row. While volatility has virtually disappeared this new year the market continues to work its way higher. For the week the SPX/DOW were +2.20%, and the NDX/NAZ were +2.75%. Foreign markets also joined in, with Asia and Europe both +3.10%, as was the DJ World index. Economic reports for the week were biased to the upside: 8 to 5. On the downtick: the PPI, housing starts, building permits, the Philly FED and the M1-multiplier. On the uptick: the NY FED, industrial production, capacity utilization, existing homes sales, the NAHB, the monetary base, the WLEI and weekly jobless claims improved. Next week, the FED meets tuesday and wednesday, then Leading indicators and Q4 GDP. Best to your week!

LONG TERM: bull market

After a volatile spring and summer, that threatened to push the world’s economy into another economic meltdown, the markets and economy have recovered in the fall and winter. Pledges from the Eurozone to stabilize the sovereign debt crisis in early October helped put in the market low. Then the ECB’s recapitalization of european banks with LTRO 2, in early December, helped to keep the liquidity engine running. This was especially important, in this deflationary period, as the FED had shut down their QE 2 program in June. Then, after a “wait and see” market inflection point in December. January has signalled an all clear to the upside. Our technical indicators and the market’s activity suggest the bull market of March 2009 is back.

While the B wave, of Primary wave II, scenario is still possible. A glance at the monthly RSI suggests this is becoming less and less probable. Notice the previous two bear market B wave rallies stopped at the neutral line: red arrows. This advance, from the SPX 1075 low, did stall at that level for a while. But has broken clearly through it during this month’s advance: green arrow. With only 7 trading days to go in the month, this is a bullish sign.

The weekly indicators have also turned positive. After hitting an extremely oversold, typical bear market, condition in mid 2011 the Major wave 1 uptrend hit overbought and now this uptrend threatens to break through that level to possibly an extremely, typical bull market, overbought. The MACD, which broke below neutral into bear market territory, is now rising above neutral into bull market territory. As long as these trends continue the bull market remains in force. In the mean time, the economy is still soft with consumers and investors still bearish. This is a perfect set up for the resumption of a bull market.

After the 58% stock market loss during Oct07 – Mar09, to end Supercycle wave 2. We expected Cycle wave [1], of Supercycle 3, to carry the market up in five Primary waves. Primary waves I and II ended in May11 and Oct11 respectively. Primary wave III should be underway now. Rising primary waves divide into five Major waves. Major waves 1 amd 2, of Primary III, ended in Oct11 and Nov11 respectively. Major wave 3 should be underway now. This Major wave may subdivide into five Intermediate waves. Similar to Major wave 1 between Mar09 and Apr10. Currently we are anticipating this event.

MEDIUM TERM: uptrend high SPX 1315

The daily chart below offers a good view on Primary wave II and the current progress of Primary wave III. Notice the May11-Oct11 decline was five waves, but appears to have taken the form of an elongated flat. The same pattern that ended the 1987 crash. The SPX lost 22% during that 1371-1075 decline. But has already retraced 81% of that loss during the early stages of Primary wave III. In fact, it is less than 4.5% from making a new bull market high. New bull market highs have already been hit by four of the nine SPX sectors: XLK, XLP, XLY and XLU. With the fifth, XLV, only a few ticks away. This does not occur during bear markets, nor bear market rallies.

From the early October SPX 1075 low the market rocketed to SPX 1293 in less than four weeks, ending Major 1. A corrective Major 2 correction followed to SPX 1159. Since then this market has been uptrending. During the uptrend we labeled Minor 1, of a potential Intermediate wave i uptrend, at SPX 1267. Then Minor wave 2 At SPX 1202. Minor wave 3 just hit SPX 1315 this week. After it concludes we should get a Minor 4, with support at SPX 1267. Then Minor wave 5 to conclude the uptrend. Currently the market is quite overbought on the daily RSI.


Support for the SPX is at the 1313 and 1303 pivots, with overhead resistance at the 1363 and 1372 pivots. Short term momentum has risen to just overbought after hitting neutral early friday. Minor wave 1 unfolded in a complete nine waves. We marked the basic five wave structure with Minute waves on the hourly chart. Minor wave 3 has thus far unfolded in an incomplete 15 waves. We again have marked the basic five wave structure with Minute waves i-ii-iii-iv on the hourly chart.

Minute wave v, the smallest of the waves, has thus far rallied in an incomplete three waves up from the Minute iv SPX 1278 low. It should have at least one more notable pullback, with support at SPX 1303, then another rally to a higher high to complete Minor wave 3. A potential scenario suggests the market opens higher on monday. Then sells off for the rest of the day. Rallies tuesday/wednesday, during the FOMC meeting, on QE 3 rumors. Then pulls back substantially, with SPX 1267 support for Minor wave 4, when no QE 3 is announced.

Currently there is absolutely no pivot resistance until the SPX enters the 1363 pivot range. Quite a gap between the 1313 and 1363 pivots. There is however some price resistance at the following levels: 1327, 1345/47 and then 1356, which is within the 1363 pivot range. Should this uptrend clear SPX 1327 we would have to consider the entire uptrend as a possible Major wave 3, rather than an Intermediate wave one of 3. Short term OEW charts have remained postive since under SPX 1230, with support now just under 1300. Short term support is at the 1313, 1303 and 1291 pivots. Overhead resistance is at SPX 1327, 1345/47 and then the 1363 pivot. Short term momentum is rising. Best to your trading!


The Asian markets were all higher on the week for a net gain of 3.1%. Only China and India have not confirmed uptrends.

The European markets were also all higher for a net gain of 3.1%. Italy is still in a downtrend.

The Commodity equity group were all higher for a net gain of 3.5%. Only Russia has not confirmed an uptrend.

The DJ World index is uptrending and gained 3.1% on the week.


Bonds lost 1.0% on the week as the choppy, trading range, uptrend from October appears to be weakening. Should a downtrend be confirmed Bonds could have a substantial drop as this last uptrend could complete a large Major ABC pattern from the April 2010 low.

Crude remains a volatile commodity, uptrending but losing 0.5% on the week.

Gold (+1.5%) appears to be uptrending from the December $1524 low. On friday it broke out of a week long trading range to the upside. Silver gained 7.7% on the week. Most of it on friday.

The USD (-1.6%) appears to be in a weakening uptrend. We have negative divergences at the recent highs. Similar to the Sept/Oct highs. And both rallies, during this lengthy six month uptrend are equal in length.


Economic reports for the week kicks off on wednesday with Pending home sales, FHFA housing prices and the FED’s FOMC statement. On thursday, weekly Jobless claims, Durable goods orders, Leading indicators and New home sales. Then friday ends the week with the Q4 GDP estimate and Consumer sentiment. Best to your weekend and week!


We have been been tracking five CEF’s (closed end funds), and two penny stocks at the back of the charts. Now that we have tracked them for a few months and are satisfied with the price activity, we will move them into the mix with the other stocks. We are not recommending these stocks. Just trying to offer some additional investment ideas for our readers. Good luck!


After about 40 years of investing in the markets one learns that the markets are constantly changing, not only in price, but in what drives the markets. In the 1960s, the Nifty Fifty were the leaders of the stock market. In the 1970s, stock selection using Technical Analysis was important, as the market stayed with a trading range for the entire decade. In the 1980s, the market finally broke out of it doldrums, as the DOW broke through 1100 in 1982, and launched the greatest bull market on record. 

Sharing is an important aspect of a life. Over 100 people have joined our group, from all walks of life, covering twenty three countries across the globe. It's been the most fun I have ever had in the market. Sharing uncommon knowledge, with investors. In hope of aiding them in finding their financial independence.

Copyright © 2012 Tony Caldaro - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in