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
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
S&P 500 Stuck at 2,900, Still No Clear Direction - 17th June 19
Is Boris set to be the next Conservation leader? - 17th June 19
Clock’s Ticking on Your Chance to Profit from the Yield Curve Inversion - 17th June 19
Stock Market Rally Faltering? - 17th June 19
Johnson Vs Gove Tory Leadership Contest Grudge Match Betfair Betting - 17th June 19
Nasdaq Stock Index Prediction System Is Telling Us A Very Different Story - 17th June 19
King Dollar Rides Higher Creating Pressures On Foreign Economies - 17th June 19
Land Rover Discovery Sport Tailgate Not Working Problems Fix (70) - 17th June 19
Stock Market Outlook: is the S&P today just like 2007 or 2016? - 17th June 19
US China War - Thucydides Trap and gold - 16th June 19
Gold Stocks Bull Upleg Mounting - 16th June 19
Gold Price Seasonal Trend Analysis - Video - 16th June 19
Fethiye Market Fruit, Veg, Spices and Turkish Delight Tourist Shopping - 16th June 19
US Dollar Gold Trend Analysis - 15th June 19
Gold Stocks “Launch” is in Line With Fundamentals - 15th June 19
The Rise of Silver and Major Economic Decline - 15th June 19
Fire Insurance Claims: What Are the Things a Fire Claim Adjuster Does? - 15th June 19
How To Find A Trustworthy Casino? - 15th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match - Video - 14th June 19
Gold and Silver, Precious Metals: T-Minus 3 Seconds To Liftoff! - 14th June 19
Silver Investing Trend Analysis - Video - 14th June 19
The American Dream Is Alive and Well - in China - 14th June 19
Keeping the Online Gaming Industry in Line - 14th June 19
How Acquisitions Affect Global Stocks - 14th June 19
Please Don’t Buy the Dip in Nvidia or Other Chip Stocks - 14th June 19
A Big Thing in Investor Education is Explainer Videos - 14th June 19
IRAN - The Next American War - 13th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match Contest - 13th June 19
Top Best VPN Services You Can Choose For Your iPhone - 13th June 19
Tory Leadership Contest Betting Markets Forecast - Betfair - 13th June 19
US Stock Market Setting Up A Pennant Formation - 13th June 19
Which Stocks Will Lead The Cannabis Rebound? - 13th June 19

Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

Stock Market Forming Topping Pattern

Stock-Markets / US Stock Markets Jun 25, 2007 - 12:31 AM GMT

By: David_Petch

Stock-Markets

I am glad I waited for one more day to examine the S&P, because the volatility confirms that a topping formation is underway and likely will last into September/October (most likely October). The US Dollar declined sharply today and a falling US stock market makes the decline a double whammy.

The upper 55 MA Bollinger band curling down did confirm a top, with the depth of the lower 55 MA Bollinger band suggestive a decline to 1440 is probable but not for 2-4 weeks. Short-term stochastics have the %K beneath the %D within the confines of an expanding stochastic wedge. Given the volatility witnessed during the past two weeks, I do not want to even try and catch every zig and zag. Rather I want to focus on the markets having a chronological decline type of topping process over the course of the next 3-4 months before declining.


Figure 1

Red lines on the right hand side represent Fibonacci price projects of upward trending wave price action projected off their subsequent lows. Areas of line overlap form Fib clusters, which indicate important support/resistance levels. The 1532 Fib cluster marked the top, which coincided with the upper trend line of the channel formed from the July 2006 and March 2007 lows. There is significant Fib support so 1440, which could be the bottoming portion of the current decline phase. Failure for the S&P to remain above 1440 would see a sharp decline to 1370. We will have to examine the pattern development on a week to week basis, but the top that forms should have a declining pattern of lower highs before a sharp decline this fall. Moving averages are in bullish alignment (50 day MA above the 155 day MA above 200 day MA), with the 50 day MA acting as support at 1500. Full stochastics have the %K beneath the %D, which has approximately 2-4 weeks to bottom before heading higher.

Figure 2

The weekly S&P 500 Index chart is shown below, with Fibonacci time extensions of the decline from 2000 until early 2003 and Fib price retracements of the decline shown on the right hand side (denoted in blue). Notice how the S&P has moved within Fib channels since late 2003. Every time the S&P moved through a higher Fib level, it broke higher only to back test the breakout and again go higher. Since the pattern has worked well, there is not reason to assume this trend will not continue. The S&P is going to test 1368 (may as well be 1372 as per Figure 2) at some point between now and October before declining to 1241.

The lower 55 week MA Bollinger band has started to curl up, suggestive the top is in place. Given the depth of the lower 55 week MA BB, it is too low to have an outright crash; allow for 3-4 months to pass and this will see a reduction in the volatility thereby allowing the decline phase to commence. Full stochastics have the %K above the %D within the confines of a rising stochastic wedge. The %K may cross beneath the %D but likely will remain inside the wedge for another 3-4 months. Failure for the %K to remain above the lower trend line of the rising wedge will see an instant decline of significant proportion. Things “should” continue to muddle along until early October, but if some unforeseen event were to occur, it could be a trigger.

Figure 3

The mid-term Elliott Wave chart of the S&P 500 Index is shown below. I decided to reduce the time frame of the chart, since it was starting to get backed up. The move up in wave [W] is complete, with wave [X] currently underway. The green line on the right hand side denoting the thought market path is not properly fit to the time scale. The pattern could happen in one week or 3 weeks……focus more on the pattern objectives that the time objectives.

Figure 4

The long-term Elliott Wave chart of the S&P 500 Index is shown below, with the thought pattern denoted in green and again, it is not accurately fit to the time scale. The S&P is likely forming a flat for a lower Degree of wave [X] (uncertain if it is Minor Degree (first portion of wave [X] or of Intermediate Degree (one third of the corrective phase underway). When the 1370 area gets hit later, expect a rebound to just below 1500, before starting a rapid decline to 1240ish. Wave b has had 1/3 of the pattern complete, with wave [X] being an intermediary corrective phase between wave [W] and wave [Y] yet to form.

Figure 5

That is all for this early AM. I will update the base metal portfolio stocks later on tomorrow night. Have a great day tomorrow.

By David Petch

http://www.treasurechests.info

The main focus of my work pertains to analysis of the USD index, S&P 500 Index, 10 Year US Treasury Index, AMEX Gold BUGS Index and the AMEX Oil Index using market analysis specified in a former article I wrote titled “The Technical Palette” (Elliott Wave, Bollinger bands, stochastics). We also cover around 30-40 gold/silver, base metal and energy stocks, which have done quite well recently. If this is the kind of analysis you are looking for, we invite you to visit our new and improved web site and discover more about how our service can further aid you in achieving your financial goals. For your information, our new site includes such improvements as automated subscriptions, improvements to trend identifying / professionally annotated charts, to the more detailed quote pages exclusively designed for independent investors who like to stay on top of things. Here, in addition to improving our advisory service, our aim is to also provide a resource center, one where you have access to well presented 'key' information concerning the markets we cover. And if you have any questions, comments, or criticisms regarding the above, please feel free to drop us a line . We very much enjoy hearing from you on these matters.

Copyright © 2007 treasurechests.info Inc. All rights reserved.

Unless otherwise indicated, all materials on these pages are copyrighted by treasurechests.info Inc. No part of these pages, either text or image may be used for any purpose other than personal use. Therefore, reproduction, modification, storage in a retrieval system or retransmission, in any form or by any means, electronic, mechanical or otherwise, for reasons other than personal use, is strictly prohibited without prior written permission.

Disclaimer: The above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities as we are not registered brokers or advisors. Certain statements included herein may constitute "forward-looking statements" with the meaning of certain securities legislative measures. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the above mentioned companies, and / or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Do your own due diligence.

David Petch Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Nina de Costa
21 Jul 08, 11:37
S&P Average Market Recovery Time

Would you happen to know the average historical time it has taken for the stock market to recover?


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules