Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Silver Short-Term Trend Analysis - 26th June 19
Iran and the Dying Days Of the US Empire - 26th June 19
Why a Saturated Online Gaming Market Spells Good News for Gamblers - 26th June 19
Natural Gas Sets Up Bottom Pattern - 26th June 19
Has Gold Price Broken Out Or Not? Technicals And Fundamentals - 26th June 19
Stocks and XAU Gold Miners Next Bull and Bear Markets are Now Set Up - 26th June 19
Gold Price Trend Forcast to End September 2019 - Video - 25th June 19
Today’s Pets.com and NINJA Loan Economy - 25th June 19
Testing the Fed’s Narrative with the Fed’s Data: QT Edition - 25th June 19
What "Pro Traders" use to Find Profitable Trades - eBook - 25th June 19
GDX Gold Stocks ETF - 25th June 19
What Does Facebook’s LIBRA New Crytocurrency Really Offer? - 25th June 19
Why Bond Investors MUST Be Paying Attention to Puerto Rico - 25th June 19
The Next Great Depression in the Making - 25th June 19
The Bad News About Record-Low Unemployment - 24th June 19
Stock Market New High, but…! - 24th June 19
Formula for when the Great Stock Market Rally Ends - 24th June 19
How To Time Market Tops and Bottoms - 24th June 19
5 basic tips to help mitigate the vulnerability inherent in email communications - 24th June 19
Will Google AI Kill Us? Man vs Machine Intelligence - 24th June 19
Why are Central Banks Buying Gold and Dumping Dollars? - 23rd June 19
Financial Sector Paints A Clear Picture For Stock Market Trading Profits - 23rd June 19
What You Should Look While Choosing Online Casino - 23rd June 19
INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - 22nd June 19
Here’s Why You Should Drive a Piece of Crap Car - 22nd June 19
How Do Stock Prices React to Fed Interest Rate Cuts? - 22nd June 19
Gold Bull Market Breaking Out! - 21st June 19
Post-FOMC Commentary: Delusions of Grandeur - 21st June 19
Gold Scores Gains as Draghi and Powel Grow Concerned - 21st June 19
Potential Upside Targets for Gold Stocks - 21st June 19
Gold Price Trend Forcast to End September 2019 - 21st June 19
The Gold (and Silver) Volcano Is Ready to Erupt - 21st June 19
Fed Leaves Rates Unchanged – Gold & Stocks Rally/Dollar Falls - 21st June 19
Silver Medium-Term Trend Analysis - 20th June 19
Gold Mining Stocks Waiting on This Chart - 20th June 19
A Key Gold Bull Market Signal - 20th June 19
Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - 20th June 19
Investing in APPLE (AAPL) to Profit From AI Machine Learning Stocks - 20th June 19
Small Cap Stocks May Lead A Market Rally - 20th June 19 -
Interest Rates Square Minus Zero - 20th June 19
Advice for Financing a Luxury Vehicle - 20th June 19
Stock Market Final Blow Off Top Just Hit… Next Week Comes the FIREWORKS - 20th June 19
US Dollar Rallies Off Support But Is This A Top Or Bottom? - 19th June 19
Most Income Investors Are Picking Up Nickels in Front of a Steamroller - 19th June 19
Is the Stock Market’s Volatility About to Spike? - 19th June 19
Facebook's Libra Crypto currency vs Bitcoin: Five Key Differences - 19th June 19
Fed May Trigger Wild Swing In Stock Index and Precious Metals - 19th June 19
How Long Do Land Rover Discovery Sport Brake Pads Last? - 19th June 19
Gold Golden 'Moment of Truth' Is Upon Us: $1,400-Plus or Not? - 18th June 19
Exceptional Times for Gold Warrant Special Attention - 18th June 19
The Stock Market Has Gone Nowhere and Volume is Low. What’s Next - 18th June 19
Silver Long-Term Trend Analysis - 18th June 19
IBM - Watson Deep Learning - AI Stocks Investing - Video - 18th June 19
Investors are Confident, Bullish and Buying Stocks, but… - 18th June 19
Gold and Silver Reversals – Impossible Not to Notice - 18th June 19

Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

Stock Market Continues On Breakout.. Approaching 70 Week Moving Averages

Stock-Markets / Stock Index Trading Aug 09, 2009 - 08:18 AM GMT

By: Jack_Steiman

Stock-Markets

Best Financial Markets Analysis ArticleWe have moved up over the past five months quite powerfully. There have been many critical levels of resistance along the way which have been headaches initially but in time have all been taken out by the bulls, putting those levels in their rear view mirror. 956 on the S&P 500 was the last big one that seemed as if it just couldn't happen. I mean come on, we've come so far so quickly, that level will fail for sure. Not to be the case. That too went away. Now we see two levels that are seemingly just too tough as well. One is the multi down trend line on the Nasday at 2015.


We've been banging on the door with the market being very overbought. Surely the overbought alone is enough to stop it cold. That has been the case thus far. We keep getting right there only to see the market pull back. On top of that multi year trend line at Nas 2015 we also have a bigger one to overcome. Very quietly, and not talked about by basically anyone, we are up against the 70 week moving average at 1036 on the Sp. We still have a ways to go to get there. Why am I focusing on this? Because historically, the 70 week moving average, when in a true bear market, has stopped all rallies dead in their tracks. It has caused one bull run after another to top out and collapse back down.

With the market extremely close to Nas 2015 and fairly close to Sp 1036, and because we're so overbought, this would be a perfect spot for that pull back we've all been waiting for. Doesn't mean it's coming. If you go back and look at April-June 2008 we stayed at rsi 70+. Two plus months so it can happen. Doesn't mean it will. We all have to be prepared for a sharp pullback at any time. Here's the reason for why the bears are desperate here. If we do clear with force Sp 1036 and Nas 2015, we are in a confirmed bull market. No question about it. No longer can we say this is possibly only a bull market rally within a deeper secular bear market.

The bears know all the other levels that were taken out hurt them badly. They know if these levels just mentioned get taken out, they're dead for good. So if you think they were desperate at other levels along the road, you haven't seen anything yet. These are I'm going to my death bed levels and I am not going down that easily feelings from the bears. These are the levels they defend the most. If the bulls can keep things close for a while, the bears will get worn out. Incredibly interesting and important times indeed.

The futures were up a bit this morning in anticipation of the huge jobs report that was due out at 830 am eastern time. The thinking was for a loss of 275,000 jobs with an unemployment rate of 9.7%. There was also the thinking that revisions to the past few months, as babbled by a popular Cnbc commentator the day before, were for additional losses of over 100,000. Wrong! Revisions were only 43,000 and the actual monthly losses  for this past month were 243,000. Better than expected. On top of that, the unemployment rate was 0.3% better at 9.4%, rather than the 9.7% expected.

Job losses, the unemployment rate and revisions were all better than expected for the bulls thus futures blasted off. They pulled back some before the market opened but we still had a nice gap up. The market started to pull back adn we were printing ugly black candles in the first hour. It looked bad but out of nowhere, we blasted back higher and were up nearly 200 points on the Dow before late selling took us down pretty good. We got to the breakout on the Nas at 2015 but couldn't get the job done. A solid day for the bulls. We're still overbought. We're still on an overall major buy signal. Shorting just because we're so overbought is too risky. Sticking with the overall trend makes the most sense. Dealing with pullbacks is something we'll have to deal with. Just the way it is. Some exposure is necessary at all times when on a buy signal. Keep with the trend please.

Sentiment Analysis:



This has deteriorated some with the bulls now a bit over 20% more than the bears. This is not where bull markets run in to trouble, It usually takes nearly 40% more bulls before things get out of hand from a sentiment perspective. The put call ratio is on the lower side but nothing at all on the dangerous side of the ledger. No repeat days of below 0.60. Most days in the 0.70 range. When we sell some, it ramps higher than that. we're not at a level of optimal bearishness but by no means are we at a point where this should all come crumbling down.

Sector Watch:

The Financial's led the way this week led by the Banks.   Most other groups saw decent gains including the Aerospace Group led by solid moves by Boeing (BA) and United Technologies (UTX).  The Transports continue to show solid price action and the Retail area showed some signs of firming up late week.  The Materials area continues to show some good relative performance. 

The Commodities on the other hand started to lag due to a combination of late week strength in the US Dollar which is starting to setup in a Bullish Falling Wedge Pattern (see our 5th chart below) and weakness in the Shanghai Market which after tagging the 3,500 level stalled out late week at our down trend line (see our 6th chart below).  The Biotech/Healthcare areas lagged somewhat this week after strong recent moves.  Some of the recent leading stocks in various groups started to take a breather during the week including Goldman Sachs (GS), Research in Motion (RIMM), and others while the second/third tier picked up some of the slack keeping the bid under the overall market.



The Week Ahead:

A big week ahead as we see just what the bears have with regards to stopping the bulls from taking out Nas 2015 and Sp 1036. There isn't nearly the type of economic reports to come as we had today. We also no longer have the major earnings reports to worry about. Most of those are past us. the market can play on its own without too much outside influence. With most of the recent news being positive, the onus is on the bears to stop the bulls cold in their tracks. A pullback from overbought can happen at any time but don't forget that we're clearly still in a buy signal. Very interesting times are upon us in terms of the longer term picture for this stock market.

Have a Great Weekend!

Peace
Jack Steiman

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 30-Day Trial to SwingTradeOnline.com!

© 2009 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

Jack Steiman 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

6 Critical Money Making Rules