Best of the Week
Most Popular
1. Ray Dalio: This Debt Cycle Will End Soon - John_Mauldin
2.Stock Market Dow Plunge Following Fake US - China Trade War Truce - Nadeem_Walayat
3.UK House Prices 2019 No Deal BrExit 30% Crash Warning! - Nadeem_Walayat
4.What the Oil Short-sellers and OPEC Don’t Know about Peak Shale - Andrew_Butter
5.Stock Market Crashed While the Yield Curve Inverted - Troy_Bombardia
6.More Late-cycle Signs for the Stock Market and What’s Next - Troy_Bombardia
7.US Economy Will Deteriorate Over Next Half Year. What this Means for Stocks - Troy_Bombardia
8.TICK TOCK, Counting Down to the Next Recession - James_Quinn
9.How Theresa May Put Britain on the Path Towards BrExit Civil War - Nadeem_Walayat
10.This Is the End of Trump’s Economic Sugar High - Patrick_Watson
Last 7 days
Gold Price – US$700 Or US$7000? - 16th Jan 19
Commodities Are the Right Story for 2019 - 16th Jan 19
Bitcoin Price Wavers - 15th Jan 19
History Shows That “Disruptor Stocks” Will Make You the Most Money in a Bear Market - 15th Jan 19
What Will the Stock Market Do Around Earnings Season - 15th Jan 19
2018-2019 Pop Goes The Debt Bubble - 15th Jan 19
Are Global Stock Markets About To Rally 10 Percent? - 15th Jan 19
Here's something to make you money in 2019 - 15th Jan 19
Theresa May to Lose by Over 200 Votes as Remain MP's Plot Subverting Brexit - 15th Jan 19
Europe is Burning - 14th Jan 19
S&P 500 Bounces Off 2,600, Downward Reversal? - 14th Jan 19
Gold A Rally or a Bull Market? - 14th Jan 19
Gold Stocks, Dollar and Oil Cycle Moves to Profit from in 2019 - 14th Jan 19
How To Profit From The Death Of Las Vegas - 14th Jan 19
Real Reason for Land Rover Crisis is Poor Quality of Build - 14th Jan 19
Stock Market Looking Toppy! - 13th Jan 19
Liquidity, Money Supply, and Insolvency - 13th Jan 19
Top Ten Trends Lead to Gold Price - 13th Jan 19
Silver: A Long Term Perspective - 13th Jan 19
Trump's Impeachment? Watch the Stock Market - 12th Jan 19
Big Silver Move Foreshadowed as Industrial Panic Looms - 12th Jan 19
Gold GDXJ Upside Bests GDX - 12th Jan 19
Devastating Investment Losses Are Coming: What Is Your Advisor Doing About It? - 12th Jan 19
Things to do Before Choosing the Right Credit Card - 12th Jan 19
Japanese Yen Outlook In 2019 - 11th Jan 19
Yield curve suggests that US Recession is near: Trading Setups - 11th Jan 19
How Unrealistic Return Assumptions Are Ruining Your Stocks Portfolio - 10th Jan 19
What’s Next for the US Dollar, Gold, Stocks & Bonds? - 10th Jan 19
America's New Africa Strategy - 10th Jan 19
Gold Mine Production by Country - 10th Jan 19
Gold, Stocks and the Flattening Yield Curve - 10th Jan 19
Silver Price Trend Forecast Target for 2019 - 10th Jan 19
Silver Price Trend Forecast 2019 - 9th Jan 19
Did Strong December Payrolls Push Gold Prices Up? - 8th Jan 19
How to Spot A Tradable Stock Market Top? - 8th Jan 19
Why 90% of Traders Lose - 8th Jan 19
Breadth is Very Strong While Stocks are Surging. What’s Next for Stocks - 8th Jan 19
Half of Investment-Grade Bonds Are Just One Step from Junk Status - 7th Jan 19
Stocks Rallied Again, Still Just an Upward Correction? - 7th Jan 19
Gold Golden Long-Term Opportunity - 7th Jan 19

Market Oracle FREE Newsletter

Bitcoin Analysis and Trend Forecast 2019

Stock Market Uptrend May be Topping

Stock-Markets / Stock Markets 2013 Jul 20, 2013 - 06:31 PM GMT

By: Tony_Caldaro

Stock-Markets

The market started the week by making a new uptrend high on Monday, pulled back, made a new all time high on Thursday, pulled back, then ended the week within one point of the all time high. For the week the SPX/DOW were +0.60%, the NDX/NAZ were -0.75%, and the DJ World index gained 1.0%. Economic reports returned to a positive bias this week. On the uptick: retail sales, the NY/Philly FED, business inventories, the CPI, industrial production and capacity utilization, the NAHB housing index, and weekly jobless claims were lower. On the downtick: housing starts, building permits, the M1 multiplier and the WLEI. Next week more housing reports, durable goods orders and consumer sentiment.


LONG TERM: bull market

The market ended the week within one point of the all time high established on Thursday at SPX 1693. The bull market continues. Unfortunately, as we have been reporting, the US is one of the few, if not the only, bonafide bull market of the twenty international indices we track. When this bull market starts to stumble the thud will be heard worldwide.

We continue to count this bull market as Cycle wave [1] of Super cycle wave 3. Super cycle bull markets last 70 – 80 years. But Cycle [1] bull markets typically last about five years. We continue to expect five Primary waves to conclude before this bull market ends. Primary wave I and II completed in 2011, and Primary III has been underway since then. Primary I divided into the typical five Major waves, but had a subdividing Major wave 1. Primary III is also dividing into five Major waves, but both Major 1 and 3 are subdividing into five Intermediate waves.

Major waves 1 and 2, of Primary III, completed by mid-2012. Major wave 3 has been underway since then. Intermediate waves i and ii completed by late-2012, and Int. waves iii and iv completed by mid-2013. Intermediate wave v, of Major wave 3, of Primary III is currently underway. When this uptrend concludes a Major wave 4 correction will follow, and the market should lose about 10% of its value. After that we expect a Major wave 5 uptrend to new highs, concluding Primary wave III. Then after a Primary wave IV correction, a Primary wave V uptrend to new highs should complete the bull market. We continue to target the bull market conclusion by late-winter to early-spring of 2014.

MEDIUM TERM: uptrend

When this uptrend began at SPX 1560 in mid-June we projected a minimum target of the 1680 pivot for Minor wave 3, and the 1699 pivot for Minor wave 5. These targets were met this week when the SPX entered the 1699 pivot range. We had also projected a July uptrend high would probably end at the 1699 pivot, or an August uptrend high at the 1779 pivot. The question on some traders minds; “Is the market topping here, or preparing to extend into August?”

During the week we posted three potential short term counts to address this question. One of the three has already been eliminated. This leaves us with two potential counts: one posted on the SPX hourly chart, and the other on the DOW hourly chart. Both counts, as of Friday’s close are still valid. The SPX count suggests the uptrend is in the process of a forming a top. The DOW count suggests the uptrend will probably extend into August. The internal wave structure of this uptrend and the technicals, are the keys to this inflection point. Medium term support is at the 1680 and 1628 pivots, with resistance at the 1699 and 1779 pivots.

SHORT TERM

From the SPX 1560 Intermediate wave iv downtrend low we counted five waves up to SPX 1627, then a three wave pullback to 1605. This completed Minor waves 1 and 2. After that the market rallied quite strongly, in a five wave sequence, to SPX 1685. This could have ended Minor wave 3. The pullback that followed, however, was smaller than the 20+ points expected for a Minor wave 4 (1685-1672). From that low the market rallied to SPX 1693, and then pulled back on Friday to 1684 for another small pullback. During an Int. wave i or wave iii uptrend, we would consider this normal Minor wave 3 activity. However, since there have be several shortened fifth waves during this bull market. We can not assume this fifth wave will follow normal uptrend activity.

During this uptrend the smaller pullbacks, and there have been quite a few, have declined between 9 and 13 points. Minor wave 2 stands out as a 22 point pullback. From the Minor wave 2 SPX 1605 low the market has advanced into Friday’s close with four small pullbacks between the same 9 and 13 points. Normally, we would consider this rally an ongoing Minor wave 3. In fact, should the SPX rise above 1693 we would count this advance as an ongoing Minor wave 3. The count posted on the DOW charts. If it fails to clear SPX 1693, then the count posted on the SPX charts, a potential uptrend high, becomes the probable count.

Technically there are some negatives supporting a potential uptrend high scenario. The SPX/DOW have met the minimum requirements to complete this uptrend, and there are negative divergences on most timeframes. A strong rally, however, would clear them away. Currently, we would put the probabilities for the two scenarios at 50-50. Short term support is at the 1680 pivot and SPX 1658-1667, with resistance at the 1699 and 1779 pivots. Short term momentum ended the week overbought. The short term OEW charts remain positive with the reversal level now SPX 1675.

FOREIGN MARKETS

The Asian markets were mostly higher gaining 0.2% on the week. Australia, India and Japan are in confirmed uptrends.

The European markets were mostly higher gaining 1.9% on the week. England, France, Germany and Switzerland are in confirmed uptrends.

The Commodity equity group were all higher on the week gaining 3.3%. Canada and Russia are in confirmed uptrends.

The DJ World index is uptrending and gained 1.0% on the week.

COMMODITIES

Bonds continues to look like they are beginning to uptrend gaining 0.7% on the week.

Crude remains in an uptrend since April gaining 1.8% on the week.

Gold continues to work its way higher gaining 0.9% on the week.

The USD may be downtrending again losing 0.3% on the week.

NEXT WEEK

Monday we have Existing home sales at 10:00. Tuesday: FHFA housing prices. Wednesday: New home sales. Thursday: weekly Jobless claims and Durable goods orders. Friday: Consumer sentiment. A quiet week, with a quiet FED, ahead of the FOMC meeting on Tuesday/Wednesday of the following week. Best your weekend and week!

CHARTS: http://stockcharts.com/public/1269446/tenpp

http://caldaroew.spaces.live.com

After about 40 years of investing in the markets one learns that the markets are constantly changing, not only in price, but in what drives the markets. In the 1960s, the Nifty Fifty were the leaders of the stock market. In the 1970s, stock selection using Technical Analysis was important, as the market stayed with a trading range for the entire decade. In the 1980s, the market finally broke out of it doldrums, as the DOW broke through 1100 in 1982, and launched the greatest bull market on record. 

Sharing is an important aspect of a life. Over 100 people have joined our group, from all walks of life, covering twenty three countries across the globe. It's been the most fun I have ever had in the market. Sharing uncommon knowledge, with investors. In hope of aiding them in finding their financial independence.

Copyright © 2013 Tony Caldaro - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Tony Caldaro Archive

© 2005-2018 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