Apr 24, 2016

Weekly preview

Short term view - I think we will see one more higher high.
Intermediate term view - the indexes should start toping next week.

The indexes squeezed one more push higher, SP500 "dancing" around 2100 and now pulling back - all this was expected.... now I think this is wave 5 it looks long enough. The Fibonacci targets are 2125/2150/2195.

The indexes are higher for 10-11 weeks the 20 week cycle should top soon. The indicators and market breadth with divergences. TomDemark sell setup finished on the weekly chart and sequential on the daily chart. No reversal signs so far, but all this makes me nervous:)
I do not think the indexes will just reverse and plunge lower, it does not work this way with such moves, but I would say it is time to think about exit plan.

Short term - the move is difficult to count and I do not know which path will play out, but I think we will see one more higher high.
From the top on Thursday the European indexes are showing only choppy corrective move and I favor the green scenario one more push higher before FOMC to finish wave 5 and the whole move since mid February.
Above the blue line is still bullish if it is broken a bigger pullback is running.

Intermediate term - the indicators does not look so good any more... to many divergences for my taste:)

Long term - no change.

The Market Breadth Indicators - look tired with divergences. For a bullish move this does not mean reversal and plunge lower, but there is not much left to the upside and a pullback should begin soon.
McClellan Oscillator - lower high and divergences.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - sell signal, turned lower at overbought levels.
Bullish Percentage - buy signal with small divergence.
Percent of Stocks above MA50 - still in the buy zone, but turned lower. The rally has less participants.
Fear Indicator VIX - double bottom at oversold levels.
Advance-Decline Issues - lower high and divergence.

Day 11 of the current 40 day cycle. Week 10 of the 20 week cycle(average length is 14-16 weeks).

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
TomDemark sell setup finished on the weekly chart and sequential on the daily chart. Wait for price flip - close below the close 4 days ago and this is currently 2073.

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