Jun 4, 2016

Weekly preview

Short term view - expecting the pullback to finish early next week.
Intermediate term view - higher for a few weeks in June than lower until September.

Very choppy week.... waste of time. The pullback is shallow and overlapping which confirms corrective move. The forecast stays the same. The price is around the highs and burning time in some ugly overlapping structure which increases the probability that the analysis is right - 20 week cycle low behind us and one more higher high testing the ATH.

Short term - I think we should see one final move lower to finish the pullback before continuing higher. Any move lower should stay above support - the lower blue lines/MA200.

Intermediate term - I think we are in wave B of expanding flat and we should see one more leg higher. The pullback should not break below the trend line and MA50 or it will trigger something bearish.

Long term - no change. I think the bearish scenario(red) is dead, but I will wait to be 100% sure.

The Market Breadth Indicators - heading higher for a second top with divergences, hinting to expect intermediate term top in the next few weeks.
McClellan Oscillator - above zero, building bigger divergencies.
McClellan Summation Index - buy signal, second lower top?
Weekly Stochastic of the Summation Index - turning up from oversold levels.
Bullish Percentage - weaker move higher for a second lower top.
Percent of Stocks above MA50 - moving higher for a second lower top.
Fear Indicator VIX - no fear, nothing interesting
Advance-Decline Issues - expecting to see divergences building in the next weeks.

Day 10 of the next 40 day cycle.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Sell setup finished on Friday. A few days lower will look good.

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