Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
Has Next UK Financial Crisis Just Started? Bank Accounts Being Frozen - 21st July 19
Silver to Continue Lagging Gold, Will Struggle to Overcome $17 - 21st July 19
What’s With all the Weird Weather?  - 21st July 19
Halifax Stopping Customers Withdrawing Funds Online - UK Brexit Banking Crisis Starting? - 21st July 19
US House Prices Trend Forecast 2019 to 2021 - 20th July 19
MICROSOFT Cortana, Azure AI Platform Machine Intelligence Stock Investing Video - 20th July 19
Africa Rising – Population Explosion, Geopolitical and Economic Consquences - 20th July 19
Gold Mining Stocks Q2’19 Results Analysis - 20th July 19
This Is Your Last Chance to Dump Netflix Stock - 19th July 19
Gold and US Stock Mid Term Election and Decade Cycles - 19th July 19
Precious Metals Big Picture, as Silver Gets on its Horse - 19th July 19
This Technology Everyone Laughed Off Is Quietly Changing the World - 19th July 19
Green Tech Stocks To Watch - 19th July 19
Double Top In Transportation and Metals Breakout Are Key Stock Market Topping Signals - 18th July 19
AI Machine Learning PC Custom Build Specs for £2,500 - Scan Computers 3SX - 18th July 19
The Best “Pick-and-Shovel” Play for the Online Grocery Boom - 18th July 19
Is the Stock Market Rally Floating on Thin Air? - 18th July 19
Biotech Stocks With Near Term Catalysts - 18th July 19
SPX Consolidating, GBP and CAD Could be in Focus - 18th July 19
UK House Building and Population Growth Analysis - 17th July 19
Financial Crisis Stocks Bear Market Is Scary Close - 17th July 19
Want to See What's Next for the US Economy? Try This. - 17th July 19
What to do if You Blow the Trading Account - 17th July 19
Bitcoin Is Far Too Risky for Most Investors - 17th July 19
Core Inflation Rises but Fed Is Going to Cut Rates. Will Gold Gain? - 17th July 19
Boost your Trading Results - FREE eBook - 17th July 19
This Needs To Happen Before Silver Really Takes Off - 17th July 19
NASDAQ Should Reach 8031 Before Topping - 17th July 19
US Housing Market Real Terms BUY / SELL Indicator - 16th July 19
Could Trump Really Win the 2020 US Presidential Election? - 16th July 19
Gold Stocks Forming Bullish Consolidation - 16th July 19
Will Fed Easing Turn Out Like 1995 or 2007? - 16th July 19
Red Rock Entertainment Investments: Around the world in a day with Supreme Jets - 16th July 19
Silver Has Already Gone from Weak to Strong Hands - 15th July 19
Top Equity Mutual Funds That Offer Best Returns - 15th July 19
Gold’s Breakout And The US Dollar - 15th July 19
Financial Markets, Iran, U.S. Global Hegemony - 15th July 19
U.S Bond Yields Point to a 40% Rise in SPX - 15th July 19
Corporate Earnings may Surprise the Stock Market – Watch Out! - 15th July 19
Stock Market Interest Rate Cut Prevails - 15th July 19
Dow Stock Market Trend Forecast Current State July 2019 Video - 15th July 19
Why Summer is the Best Time to be in the Entertainment Industry - 15th July 19
Mid-August Is A Critical Turning Point For US Stocks - 14th July 19
Fed’s Recessionary Indicators and Gold - 14th July 19
The Problem with Keynesian Economics - 14th July 19

Market Oracle FREE Newsletter

Top AI Stocks Investing to Profit from the Machine Intelligence Mega-trend

Stocks Bull Market Continues

Stock-Markets / Stock Markets 2013 Sep 22, 2013 - 04:27 PM GMT

By: Tony_Caldaro

Stock-Markets

An expected volatile FOMC/Options expiration week did not disappoint. The market started the week with a gap up opening, held those highs on Tuesday, then spiked when FED chairman Bernanke did not taper QE 3 as was expected. Then the unwinding of that spike unfolded during Thursday and Friday’s expiration. For the week the SPX/DOW were +0.95%, the NDX/NAZ were +1.45%, and the DJ World index was +2.0%. Economic reports for the week ended positive. On the uptick: industrial production, the CPI, existing home sales, the Philly FED, leading indicators, the monetary base and the WLEI. On the downtick: the NY FED, the NAHB, housing starts, building permits, and weekly jobless claims rose. Next week: Q2 GDP (est. +2.5%), PCE prices and more housing reports.


LONG TERM: bull market

With the markets inflection point out of the way, and the much anticipated QE 3 taper a non-event, we can concentrate on the long term count. The recent August correction only declined about half of what was expected. The three previous Major wave corrections, during this bull market, had ranged between 7.4% and 17% in the SPX and 6.7% and 14.9% in the DOW. So we expected something about in the middle, around 10%. At the August low, however, the SPX had only corrected 4.9% while the DOW corrected 5.7%. This correction, being the smallest of the four Major wave corrections, could not be anticipated in advance. Our error, we got it wrong.

While there has been some discussion of a more bullish count long term. We are maintaining our conservative bull market count as we have been reporting now for a few years. This bull market remains Cycle wave [1] and should unfold in five Primary waves. Primary waves I and II ended in 2011. Primary wave III has been underway since then. Primary I divided into five Major waves with a subdividing Major wave 1. Primary wave III has also be dividing into five Major waves, but both Major waves 1 and 3 subdivided. Major waves 1 and 2 of Primary III ended by mid-2012, and Major waves 3 and 4 appear to have just ended in mid-2013. Major wave 5 of Primary III should now be underway. When this uptrend concludes it should end Primary wave III. Then after Primary IV correction, the next uptrend, Primary wave V, should end the bull market. We still expect a bull market top by late-winter to early-spring 2014.

MEDIUM TERM: uptrend

It was a disappointing August downtrend for many traders as the market only declined to the 1628 pivot, found support, and began to rally. However, the downtrend was sufficient to trigger a confirmation in the bellwether DOW which retraced over 80% of its previous uptrend. As a result of this OEW activity we have labeled the recent low as Major wave 4 in both the SPX and DOW. The uptrend, which has been underway since the late August low, is Major wave 5.

Since Major wave 5, of Primary I, was the shortest of those Major waves, and did not subdivide. We are expecting Major wave 5, of Primary III, to be a one trend advance. A subdividing Major 5, however, can not be totally ruled out, since Major waves 1 and 3 have subdivided. But to anticipate something that is uncharacteristic of this bull market is not being objective, nor conservative. When this uptrend concludes the next correction should give us the answer. Typically, after a large five wave advance the market should have a significant correction. Primary wave II declined 22%. That was somewhat extraordinary for a bull market, as many turned long term bearish the exact day it bottomed. Typical corrections during this bull market have been about 10%. Medium term support is at the 1699 and 1680 pivots, with resistance at the 1779 pivot.

SHORT TERM

Since we are expecting a one trend Major wave 5, we have been labeling its advances in Intermediate waves. Intermediate wave i was a leading diagonal from SPX 1627-1662. Intermediate wave ii was a sharp decline, which often occurs after diagonals, to SPX 1641. Intermediate wave was a simple five wave advance to SPX 1730. Intermediate wave iv should be underway now, as the market has pulled back 21 points from its high. This is the same length as the entire Int. wave ii decline. After this decline concludes the market should rally to new highs to complete Int. wave v, Major wave 5, and Primary III.

Short term support is at the 1699 and 1680 pivots with resistance at the 1779 pivot. Short term momentum ended the week quite oversold. The short term OEW charts remain positive with the reversal level now SPX 1692. Best to your trading!

FOREIGN MARKETS

Asian markets were mostly higher on the week for a gain of 2.1%. All indices uptrending.

European markets were mostly higher on the week for a gain of 1.4%. All uptrending too.

The Commodity equity group were all higher for a gain of 2.1%. All uptrending as well.

The uptrending DJ World index gained 2.0%.

COMMODITIES

Bonds had a good week gaining 1.2%, but have not confirmed an uptrend yet.

Crude sold off this week losing 3.5%, and should be confirming a downtrend soon.

Gold lost only 0.2% on the week, thanks to Wednesday’s rally, but appears to be downtrending.

The USD was also in the red this week -1.2%, and is now downtrending.

NEXT WEEK

Tuesday: Case-Shiller, the FHFA housing index and Consumer confidence. Wednesday: Durable goods orders and New home sales. Thursday: Q2 GDP, weekly Jobless claims and Pending home sales. Friday: Personal income/spending, PCE prices and Consumer sentiment. The FED has only one speech on its agenda: FED governor Stein on Thursday in Germany. Best to your weekend and week!

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

    Toby Connor

    Gold Scents  

    GoldScents is a financial blog focused on the analysis of the stock market and the secular gold bull market.   Subscriptions to the premium service includes a daily and weekend market update emailed to subscribers.  If you would like to be added to the email list that receives notice of new posts to GoldScents, or have questions,email Toby.

    © 2013 Copyright Toby Connor - 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.

Toby Connor 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