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
Stock Market Rescued by the Fed Again? - 24th Sep 21
Are Amazon Best Cheap Memory Foam Mattresses Any good? Bedzonline £69 4ft Small Double ECO Example - 24th Sep 21
Evergrande not a Minsky Moment - 24th Sep 21
UK Energy Firms Scamming Customers Out of Their Best Fixed Rate Gas Tariffs - 23rd Sep 21
Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Should School Children be Jabbed with Pfizer Covid-19 Vaccine To Foster Herd Immunity? - UK - 23rd Sep 21
Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
Trading Crude Oil ETFs in Foreign Currencies: What to Focus On - 22nd Sep 21
URGENT - Crypto-trader event - 'Bitcoin... back to $65,000?' - 22nd Sep 21
Stock Market Time to Buy the Dip? - 22nd Sep 21
US Dollar Bears Are Fresh Out of Honey Pots - 22nd Sep 21
MetaTrader 5 Features Every Trader Should Know - 22nd Sep 21
Evergrande China's Lehman's Moment, Tip of the Ice Berg in Financial Crisis 2.0 - 21st Sep 21
The Fed Is Playing The Biggest Game Of Chicken In History - 21st Sep 21
Focus on Stock Market Short-term Cycle - 21st Sep 21
Lands End Cornwall In VR360 - UK Holidays, Staycations - 21st Sep 21
Stock Market FOMO Hits September CRASH Brick Wall - Dow Trend Forecast 2021 Review - 20th Sep 21
Two Huge, Overlooked Drains on Global Silver Supplies - 20th Sep 21
Gold gets hammered but Copper fails to seize the moment - 20th Sep 21
New arms race and nuclear risks could spell End to the Asian Century - 20th Sep 21
Stock Market FOMO Hits September Brick Wall - Dow Trend Forecast 2021 Review - 19th Sep 21
Dow Forecasting Neural Nets, Crossing the Rubicon With Three High Risk Chinese Tech Stocks - 18th Sep 21
If Post-1971 Monetary System Is Bad, Why Isn’t Gold Higher? - 18th Sep 21
Stock Market Shaking Off the Taper Blues - 18th Sep 21
So... This Happened! One Crypto Goes From "Little-Known" -to- "Top 10" in 6 Weeks - 18th Sep 21
Why a Financial Markets "Panic" May Be Just Around the Corner - 18th Sep 21
An Update on the End of College… and a New Way to Profit - 16th Sep 21
What Kind of Support and Services Can Your Accountant Provide? Your Main Questions Answered - 16th Sep 21
Consistent performance makes waste a good place to buy stocks - 16th Sep 21
Dow Stock Market Trend Forecasting Neural Nets Pattern Recognition - 15th Sep 21
Eurozone Impact on Gold: The ECB and the Phantom Taper - 15th Sep 21
Fed To Taper into Weakening Economy - 15th Sep 21
Gold Miners: Last of the Summer Wine - 15th Sep 21
How does product development affect a company’s market value? - 15th Sep 21
Types of Investment Property to Become Familiar with - 15th Sep 21
Is This the "Kiss of Death" for the Stocks Bull Market? - 14th Sep 21
Where Are the Stock Market Fireworks? - 14th Sep 21
Play-To-Earn Cryptocurrency Games Gain More and Is Set to Expand - 14th Sep 21
The CashFX TAP Platform - Catering to Bull Investors and Bear Investors Alike - 14th Sep 21
Why every serious investor should be focused on blockchain technology - 13th Sep 21
SPX Base Projection Reached – End of the Line? - 13th Sep 21
There are diverse ways to finance the purchase of a car - 13th Sep 21
6 Tips For Wise Investment - 13th Sep 21 - Mark_Adan

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stocks Bear Market Resumes or Just More Noise

Stock-Markets / Stock Markets 2016 Jun 26, 2016 - 02:19 PM GMT

By: Tony_Caldaro


The market started this volatile week at SPX 2071. After a gap up opening on Monday to SPX 2101 the market pulled back until Wednesday when it hit SPX 2084. Another gap up opening on Thursday carried the market to SPX 2113. Then Brexit was confirmed and markets worldwide plunged on Friday. For the week the SPX/DOW were -1.6%, and the NDX/NAZ were -2.0%. Economic reports were biased negative for the first time in quite a while. On the downtick: new home sales, durable goods, consumer sentiment and the Q2 GDP estimate. On the uptick: FHFA housing, existing home sales and weekly jobless claims declined. Next week’s reports will be highlighted by Q1 GDP, PCE prices and the Chicago PMI.

LONG TERM: neutral

For the past month or so we have been discussing the ongoing bifurcation between the futures driven SPX and the cash driven NYSE. Our OEW model suggests the SPX ended its bull market in 2015 and a bear market has been underway ever since.

The NYSE, however, suggests the bull market only completed four Primary waves, and Primary wave V is currently underway. Since some in our group consider both counts as valid, and future market action could fit both scenarios structurally, we have taken a neutral stance long term.

Despite which count wins out in the end, this has been one volatile market for investors. Since the 2015 all time high the SPX has dropped 268 points, rallied 249 points, dropped 306 points, rallied 311 points, and is now heading down again. As of Friday’s close it is down about 5% from the high.

MEDIUM TERM: downtrend

After coming within 8 points of the uptrend high at SPX 2121, the market reversed hard to the downside on Friday and confirmed a new downtrend. The inflection point, noted last week, has already been resolved without having to drop below SPX 2026. We now have three waves up from the SPX 1810 low. This naturally suggests the entire advance from that low to SPX 2121 has been corrective, and we have labeled it Major wave B. Corrective advances like this are typical bear market activity.

However, since we are dealing with a bifurcated market the three wave advance from SPX 1810 may only be Intermediate A of Major B, and the current downtrend only Intermediate wave B. This wave structure would allow for new highs during an irregular B wave, even though this is technically a bear market. For those interested, we are carrying this count on the NAZ daily chart.

Medium term support is at the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots.


From the recent downtrend low at SPX 2026 the market rallied to SPX 2121, declined to 2050, then rallied on Thursday to 2113. This appears to be a failed inverted flat, as the last rally was five waves. Overnight the futures traded high enough for a SPX 2128 print, but the cash market never saw those levels since it opened on a gap down at SPX 2064.

Under the Major wave B scenario at SPX 2121/2113 the market should now be heading lower in a Major wave C. It could subdivide into three Intermediate waves (trends), like Major wave A, so no guarantee we are headed to new lows during this downtrend.

Under the bifurcated scenario this downtrend should only do a retracement of the entire advance from SPX 1810-2121. This would suggest two potential areas: the 1973 pivot range (50%) and the 1929 pivot range (61.8%). Short term support is at the 2019 and 1973 pivots, with resistance at the 2043 and 2070 pivots. Short term momentum ended the week quite oversold.


The Asian markets were mostly lower for a net loss of 1.2%.

The European markets were also mostly lower for a net loss of 3.3%.

The Commodity equity group were mixed for a net gain of 0.4%.

The DJ World index lost 1.7%.


Bonds continued their uptrend gaining 0.2%.

Crude may be in a downtrend and lost 2.6%.

Gold is in an uptrend and gained 1.3%.

The USD is in an uptrend and gained 1.3%.


Tuesday: Q1 GDP, Case-Shiller, Consumer confidence, and a speech from FED governor Powell. Wednesday: Personal income/spending, Pending home sales, the PCE, and a speech from FED chair Yellen. Thursday: weekly Jobless claims and the Chicago PMI. Friday: ISM manufacturing, Construction spending and Auto sales. Best to your weekend and week!


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 © 2016 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.

Tony Caldaro Archive

© 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