Apr 21, 2012

Weekly review / Седмичен преглед

Short term view - one more push lower and a short term bottom probably the first week of May
Intermediate term view - we are in an intermediate term correction lasting till mid or end of June

McClellan Oscillator - one more push lower with divergence will mark short term bottom
McClellan Summation Index - continue moving lower so the correction is not over
Weekly Stochastic of the Summation Index - the next swing UP has not started
Bullish Percentage - continue moving lower so the correction is not over
Percent of Stocks above MA50 - move to the 20-25 zone will mark short term bottom
Fear Indicator VXO - expect VXO arround 30 to mark the end of the intermediate term correction

I do not post hourly chart. This moves up and down are very difficult to predict. In my opinion the counter move is not over. I think we will see the indexes moving up/sideways for another 1-3 days.

Daily chart - the move last two weeks is corrective, the oscillators are resetting from oversold levels and the price moves nowhere. I expect another push lower to finish the first leg of the correction. Obvious target is around 1340 which is support level and 23,6% Fibonacci retracement.

On the chart is shown my long term prediction - preferred scenarios is the bullish one. If the correction is deeper than expected I will adjust the prediction.
I think for the rest of the year we will see up and down moves, the easy money are behind us.
The MACD will cool down and the Histogram want to form a trough which tells us to expect correction for the next 5-10 weeks.

CYCLES (TD - trading days)
The sell off marked the end of the last cycle which lasted 24 trading days. The current cycle is 8 trading days old. I expect in the next two weeks (another 10TD) this cycle to bottom which will be a bottom for the cycle of a bigger degree too and much stronger rebound than the current one.  

The bigger picture - the last 20 weeks cycle was longer than usual so I think the next one will be shorter 15 to 17 weeks which means a bottom in the second half of June.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technic spots areas of exhaustion.
Finished Combo 13 at the weekly chart and reversed:) Great call. Currently there is 1 and 2 of sequential but its too yearly.
T-theory(period of weakness is followed by a period of strength with at least the same length) - perfect call again:)

Finished Countdown 13 at the daily chart and reversed. Great call again:) Sequential on the down side was canceled, nothing so far.

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