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
Central Bankers' Desperate Grab for Power - 18th Sep 19
Oil Shock! Will War Drums, Inflation Fears Ignite Gold and Silver Markets? - 18th Sep 19
Importance Of Internal Rate Of Return For A Business - 18th Sep 19
Gold Bull Market Ultimate Upside Target - 17th Sep 19
Gold Spikes on the Saudi Oil Attacks: Can It Last? - 17th Sep 19
Stock Market VIX To Begin A New Uptrend and What it Means - 17th Sep 19
Philippines, China and US: Joint Exploration Vs Rearmament and Nuclear Weapons - 17th Sep 19
What Are The Real Upside Targets For Crude Oil Price Post Drone Attack? - 17th Sep 19
Curse of Technology Weapons - 17th Sep 19
Media Hypes Recession Whilst Trump Proposes a Tax on Savings - 17th Sep 19
Understanding Ways To Stretch Your Investments Further - 17th Sep 19
Trading Natural Gas As The Season Changes - 16th Sep 19
Cameco Crash, Uranium Sector Won’t Catch a break - 16th Sep 19
These Indicators Point to an Early 2020 Economic Downturn - 16th Sep 19
Gold When Global Insanity Prevails - 16th Sep 19
Stock Market Looking Toppy - 16th Sep 19
Is the Stocks Bull Market Nearing an End? - 16th Sep 19
US Stock Market Indexes Continue to Rally Within A Defined Range - 16th Sep 19
What If Gold Is NOT In A New Bull Market? - 16th Sep 19
A History Lesson For Pundits Who Don’t Believe Stocks Are Overvalued - 16th Sep 19
The Disconnect Between Millennials and Real Estate - 16th Sep 19
Tech Giants Will Crash in the Next Stock Market Downturn - 15th Sep 19
Will Draghi’s Swan Song Revive the Eurozone? And Gold? - 15th Sep 19
The Race to Depreciate Fiat Currencies Is Accelerating - 15th Sep 19
Can Crypto casino beat Hybrid casino - 15th Sep 19
British Pound GBP vs Brexit Chaos Timeline - 14th Sep 19
Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - 14th Sep 19
War Gaming the US-China Trade War - 14th Sep 19
Buying a Budgie, Parakeet for the First Time from a Pet Shop - Jollyes UK - 14th Sep 19
Crude Oil Price Setting Up For A Downside Price Rotation - 13th Sep 19
A “Looming” Recession Is a Gold Golden Opportunity - 13th Sep 19
Is 2019 Similar to 2007? What Does It Mean For Gold? - 13th Sep 19
How Did the Philippines Establish Itself as a World Leader in Call Centre Outsourcing? - 13th Sep 19
UK General Election Forecast 2019 - Betting Market Odds - 13th Sep 19
Energy Sector Reaches Key Low Point – Start Looking For The Next Move - 13th Sep 19
Weakening Shale Productivity "VERY Bullish" For Oil Prices - 13th Sep 19
Stock Market Dow to 38,000 by 2022 - 13th Sep 19 - readtheticker
Gold under NIRP? | Negative Interest Rates vs Bullion - 12th Sep 19
Land Rover Discovery Sport Brake Pads and Discs's Replace, Dealer Check and Cost - 12th Sep 19
Stock Market Crash Black Swan Event Set Up Sept 12th? - 12th Sep 19
Increased Pension Liabilities During the Coming Stock Market Crash - 12th Sep 19
Gold at Support: the Upcoming Move - 12th Sep 19
Precious Metals, US Dollar, Stocks – How It All Relates – Part II - 12th Sep 19
Boris Johnson's "Do or Die, Dead in a Ditch" Brexit Strategy - 11th Sep 19
Precious Metals, US Dollar: How It All Relates – Part I - 11th Sep 19
Bank of England’s Carney Delivers Dollar Shocker at Jackson Hole meeting - 11th Sep 19
Gold and Silver Wounded Animals, Indeed - 11th Sep 19
Boris Johnson a Crippled Prime Minister - 11th Sep 19
Gold Significant Correction Has Started - 11th Sep 19
Reasons To Follow Experienced Traders In Automated Trading - 11th Sep 19
Silver's Sharp Reaction Back - 11th Sep 19
2020 Will Be the Most Volatile Market Year in History - 11th Sep 19
Westminister BrExit Extreme Chaos Puts Britain into a Pre-Civil War State - 10th Sep 19
Gold to Correct as Stocks Rally - 10th Sep 19
Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - 10th Sep 19
Stock Market Sector Rotation Giving Mixed Signals About The Future - 10th Sep 19
The Online Gaming Industry is Going Up - 10th Sep 19

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Stocks Bear Market Rally Nearly Over

Stock-Markets / Stock Markets 2016 Mar 05, 2016 - 03:53 PM GMT

By: Tony_Caldaro

Stock-Markets

The week started at SPX 1948. On Monday the market rallied to SPX 1958, then sold off to 1932 by the close. Tuesday, however, kicked off a rally with a gap up opening that carried the market to SPX 2009 by Friday afternoon. Then after a pullback to SPX 1993 the market closed 2000. For the week the SPX/DOW gained 2.45%, the NDX/NAZ gained 2.50%, and the DJ World index gained 4.0%. On the economic front reports again came in negatively biased again. On the uptick: construction spending, ISM manufacturing, the ADP, factory orders, monthly payrolls and the GDPn. On the downtick: the Chicago PMI, pending home sales, auto sales, ISM services, the WLEI, plus the trade deficit and weekly jobless claims increased. Next week two FED speeches on tap Monday, then the ECB meets on Thursday.


LONG TERM: bear market

After the bull market ended in December, on a failed fifth wave, the SPX entered a two month Major wave A downtrend which bottomed in mid-February at 1810. From that low a Major wave B uptrend was underway, which has now retraced 65% of the bear market’s first downtrend. This is quite normal activity during bear markets. The first uptrend of the 2007-2009 bear market retraced 69.4% of the first downtrend. After that the retracements were smaller and smaller, as the downtrends became larger and larger.

Market psychology also comes into play during the early stages of bear markets. When the first downtrend of a bear market is similar to previous corrections during the bull market, investors are likely to remain generally bullish until the total decline becomes larger than any correction during the previous bull market. During the entire 2009-2015 bull market the largest correction occurred in 2011 at 21.6%. Thus far, from the all time high of SPX 2135 to the downtrend low at SPX 1810, the market has only corrected 15.2%. As reported on Friday, investors still have a bullish 61.5% of their portfolio in stocks. This is not as high as the 68.3% they had in stocks in March 2015, when they were at their most bullish level of the entire bull market. But they are still bullish.

The long term count remains unchanged. The Cycle wave [1] bull market ended in December 2015, and a Cycle wave [2] bear market is currently underway. Major wave A ended at SPX 1810, Major wave B should be near completion, and a Major wave C downtrend should follow shortly to new bear market lows. This will only complete Primary A of the three primary wave bear market. We are still expecting a bear market low some time in the year 2017 around SPX 1100.

MEDIUM TERM: uptrend

The anticipated Major wave B uptrend finally did get confirmed by OEW, and we updated the labeling from tentative green to the appropriate colors. The internal count of the uptrend remains unchanged, as we were expecting it to unfold in three Intermediate waves. Int. wave A, which topped at SPX 1947, best counts as a three Minor wave advance: 1931-1902-1947. Then after an Int. wave B decline to SPX 1891, Int. wave C was underway.

Thus far we have counted Int. wave C with: Minor A at SPX 1963, Minor B at SPX 1932 on Monday, and Minor C underway for most of this week. When Minor C ends, Int. wave C and the Major wave B uptrend will also end. Setting the stage for a Major wave C downtrend decline. Medium term support is at the 1973 and 1956 pivots, with resistance at the 2019 and 2043 pivots.

SHORT TERM

Over the past couple of weeks we had been discussing several upside targets for the Major wave B uptrend. The targets generally revolved around the 1956 and 1973 pivots, SPX 1999, and the 2019 pivot. The market exceeded the first pivot on Tuesday, the second pivot on Wednesday, and the SPX 1999 level on Friday. Which is right around where the market ended the week. The next pivot, at 2019, is the upper range of where we expected this uptrend to top. There is also one Fibonacci ratio we mentioned last week. Int. C equals Int. A at SPX 2028. If these two levels do not hold the uptrend, we are simply left with the overhead pivots posted on the hourly/daily charts.

Technically, the long term monthly MACD continues to decline. Medium term daily momentum is already quite overbought and similar to recent levels at uptrend highs. And, short term momentum was quite overbought and has started to decline. Should Int. C end like Int. A, the 2019 pivot range should hold the high. Short term support is at SPX 1999 and the 1973 pivot, with resistance at the 2019 pivot and SPX 2028. Short term momentum ended the week at neutral. Best to your trading!

FOREIGN MARKETS

Asian markets were all higher on the week and gained 4.5%.

European markets were all higher as well and gained 4.1%.

The Commodity equity group soared 9.7%, led by Brazil’s 18.0% rise.

The DJ World index is in a confirmed uptrend and gained 4.0%.

COMMODITIES

Bonds appear to have started a downtrend and lost 0.9% on the week.

Crude had another strong week in its confirmed uptrend and gained 9.4%.

Gold continues to uptrend and gained 3.1%.

The USD is still in an uptrend but lost 0.9% on the week.

NEXT WEEK

Monday: two FED speeches at 1pm, vice chair Fischer and FED governor Brainard, then Consumer credit at 3pm. Wednesday: Wholesale inventories. Thursday: the ECB, weekly Jobless claims, and the Budget deficit. Friday: Export/Import prices. With little economic data on tap it looks like we could have a technical week in the market.

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

https://caldaro.wordpress.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 © 2016 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

© 2005-2019 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