Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Final Touch?

Stock-Markets / Stock Markets 2019 Oct 28, 2019 - 12:10 PM GMT

By: Andre_Gratian

Stock-Markets

Current Position of the Market

SPX: Long-term trend – There are no clear signs that the bull market is over.

Intermediate trend –  Most likely building an intermediate top.

Analysis of the short-term trend is done on a daily basis with the help of hourly charts.  It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends


Daily market analysis of the short-term trend is reserved for subscribers.  If you would like to sign up for a FREE 4-week trial period of daily comments, please let me know at ajg@cybertrails.com

 The Final Touch?

Market Overview

SPX pushed a little higher last week, breaching the recent high of 9/15 by a tad, and challenging the all-time high of 3028 which is likely to be surpassed before this move is over.  This “exuberance” does not come as a surprise, since it was expected.  But avid bulls may soon be dismayed as the 40-wk cycle finally takes hold and causes a sharp plunge (perhaps as early as next Wednesday) when the Fed is expected to announce another rate cut.  As Arnout ter Schure of Intelligent Investing points out, the great majority of Fed decisions on interest rates since 2016 have been followed by a market correction of varying degrees.  So, since the 40-wk cycle low is deemed to be late and still ahead of us, and since this is supported by other cycles topping in early November (Eric Hadik Inside Track), it’s clear that the odds favor the rally from 2856 coming to an end at about that time. 

Nor is any of this contradicted by the action of IWM which is still in denial of any immediate strength ahead of us, furthermore visibly increasing its relative weakness to SPX this past week.  But since the 40-wk cycle should turn prices up after it bottoms, what lies past November is unclear and we will leave it up to the market to write future history.  If EWT technicians are correct, until we see some clear signs that wave 4 has completed, we will not be ready to resume the bullish trend – perhaps not for several more months, and from lower levels.

Market Analysis (All charts are courtesy of QChart)

SPX daily chart

For the past two weeks SPX has used the old channel line -- which had been previously broken and surpassed again -- for support, crawling on it in a display of less than formidable strength.  When it drops below it (next Wednesday or Thursday would be ideal) it may just slice through it as well as the bottom line of the small green channel, indicating that the laborious recent uptrend is over and that we have started a decline into the low of the 40-wk cycle.  Of course, if we move decisively above the red trend line instead, I’ll just have to make an about face and continue analyzing the market from a different perspective. 

If we do start a sharp retracement from this general area, the best targets could turn out to be either ~ 2770 or ~2690 -- both normal retracements for a correction of the move which started at 2346.  Earlier on, I had expected the 40-wk cycle to bring about a more severe correction, but the fact that it has (probably) been delayed into the end of the most negative seasonal pattern of the year should limit its impact.  Even if we do not take into consideration the present cyclical climate, the market action itself suggests that it is the end of a move rather than the beginning or extension of one.  As you will note, negative divergence has begun to appear in the daily oscillators.  Of course, confirmation will be required…and soon!

SPX hourly chart 

The crawling pattern is also very evident on the hourly chart.  A sharp rally from 2856 to the top of the previous down channel and a retest of the low, were followed by another sharp continuation of the move which morphed into the current, far less aggressive pattern with traders seemingly marking time until the next FOMC meeting.  The formation is very similar to the last three weeks going into the 3028 top (see the daily chart above).   

The oscillator pattern calls for one more little wave up creating negative divergence going into the FOMC meeting, which is the best bet for a reversal. Although a decline could be forestalled until the middle of next month.  But now we are getting into the nitty-gritty of the last few days of this short-term uptrend, and we’d better leave it to the index to show us how it will do it rather than telling it how it should!

UUP (dollar ETF) daily

Last week, UUP had a little bounce which lifted the oscillators without issuing a buy signal; so we need to wait until we see what the index does after the Fed meeting.  If it moves below the blue channel line, it may be starting a distribution pattern, since there is still no sign of one on the P&F chart.  UUP is a slow mover and it is not likely to make a sharp reversal lower anytime soon.

GDX (Gold miners ETF) weekly

GDX may be approaching the end of a well-organized correction pattern which could already have seen its final low.  This is what is suggested by the oscillators which appear to be making a break-out move.  The uptrend of the past four days found resistance at the blue 50-dma, which could lead to a few days of consolidation followed by a move above the MA.  If that occurs, GDX should quickly challenge the top of the red channel.

CCG (canopy growth) daily

CGC is in a position to conclude its intermediate downtrend, although it will most likely have to retest its low before it has any chance of moving to the top of the red channel.  

BNO (U.S. Brent oil fund) daily

BNO continues to improve its price actionIt has broken out of its corrective channel, quickly retraced, and moved back up to the top trend line.  It’s unlikely to extend its current short-term uptrend very far, especially if the market starts to correct, which would give BNO an opportunity to retest its low. 

Summary

Unless there is a radical departure from the scenario envisaged above, we are heading into the last few days of the uptrend from 2856 with a correction beginning at about the date of the FOMC meeting. . 

Andre 

FREE TRIAL SUBSCRIPTON

For a FREE 4-week trial, send an email to anvi1962@cableone.net, or go to www.marketurningpoints.com and click on "subscribe". There, you will also find subscription options, payment plans, weekly newsletters, and general information. By clicking on "Free Newsletter" you can get a preview of the latest newsletter which is normally posted on Sunday afternoon (unless it happens to be a 3-day weekend, in which case it could be posted on Monday).

Disclaimer - The above comments about the financial markets are based purely on what I consider to be sound technical analysis principles uncompromised by fundamental considerations. They represent my own opinion and are not meant to be construed as trading or investment advice, but are offered as an analytical point of view which might be of interest to those who follow stock market cycles and technical analysis.

Andre Gratian Archive

© 2005-2019 http://www.MarketOracle.co.uk - 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