Intermediate term view - just waiting....
Another week and more of the same.... it is driving me crazy already. Short term on the right side again even with this mess down up down and the bigger picture not clear again.
From EW perspective nothing has changed from last week all three scenarios are possible. The problem is:
- DJI, SP500, Nasdaq look... lets say Ok for last 5 of ED - the other indexes Russell2000 high probability that it has finished it pattern, NYSE you can count finished ED, DJT could not hold above MA200, Europe plunging lower.
- Technical indicators look awful especially on the other indexes.
- Cycles are in their time band to print a high for the 40 day and 20 week cycle.
So I would say at the moment I am neutral to bearish. The risk reward chasing long is not worth any more. This is a time only for short term traders.
How to trade it... SP500 we have 5 waves lower it could be the last wave of a flat green B, the first leg of a-b-c for E triangle.... or it could be just bearish and something to the downside has begun. In all three cases we should see something to the upside soon. If it is corrective and weak you can short the move with stop above the last high 2112. If the bearish scenario play out great, if it is the triangle small profit it is ok. If we have wave B we should see a strong reversal on Monday on a dip you can buy longs with stop below the las low 2072... that is more for short term trades.
Looking the other indexes I think we will see more to the downside.
TECHNICAL PICTURE
Short term - all three scenarios are from EW perspective are still alive. Looking at the other indexes I would say expect at least one more push lower for E of a triangle.
Intermediate term - no change.
Long term - no change
MARKET BREADTH INDICATORS
The Market Breadth Indicators - mixed... nothing which could help us at the moment.
McClellan Oscillator - touched the lower BB a bounce expected?
McClellan Summation Index - lower high, still buy signal
Weekly Stochastic of the Summation Index - buy signal
Bullish Percentage - another low high but still nothing bearish
Percent of Stocks above MA50 - in the middle of the range
Fear Indicator VIX - another long term higher low
Advance-Decline Issues - in the middle of the range, another lower high.
HURST CYCLES
Day 11 this is the second 40 day cycle of a 20 week cycle and we are in the time band for a top of this cycle.
Week 11 we should see soon a top.
Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Price flip and only 8 days of a sell setup.
Krasi, any thoughts on EEM and FXI? Both have been outperforming. FXI has gone parabolic! Any upside targets for these and downside targets? The.
ReplyDeleteI do not have much time to analyze them I am flying abroad in a few hours:) so fast - EEM,EWZ,FXI have all 5 waves higher
DeleteFXI parabolic move i would not touch it.
EEM two legs higher, a corrective move higher could be finished... or it is 3 of an impulse.
EWZ huge double zig zag lower finished and impulse higher finished or small 4/5 to finish it... wait for a 3 wave correction before another leg higher.
My opinion I would chose EWZ because of the lowest risk and the best pattern if you want to trade emerging markets.
Krasi,
ReplyDeleteThx for charts and analysis. However EW is a failure from 2011 projecting market movements as EW lacks taking sentiment into account .
Current sentiment is bubble of bonds and not in equity markets.
IMO best time to enter long postion is in the last quarter of this year when yields bottom and bonds peak .
I've been noticing this for months and stopped looking at SPX as its not a tradable market at all
Thx
Both markets are a bubble. The stock bubble will burst first followed by bonds 1-2 years later.
DeleteBonds will peak in several years and the last quarter of this year stocks will be a great short.
I think EW works fine... just the pattern is crap and last 5 months already... patience it is almost over.