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U.S. House Prices Analysis and Trend Forecast 2019 to 2021

Stock Market Trendline Broken on Fed Announcement

Stock-Markets / Stock Markets 2016 May 18, 2016 - 04:40 PM GMT

By: Anthony_Cherniawski

Stock-Markets

SPX has now broken its Head & Shoulders neckline and has bounced from its 2-hour Cycle Bottom. A rally above today’s earlier high at 2060.61 implies that it may continue back to the 4.5-year trendline. That doesn’t appear to be the case, but I am just cautioning. On the other hand, a drop below 2034.49 may open the trap door for a panic decline to the Head & Shoulders target of 1967.85, at a minimum.


ZeroHedge reports, “The supposedly dovish April FOMC statement - as global fears fell and turned domestically - has left bonds and bullion the winners and stocks the losers as investors lose faith in The Fed's forecast and economic promises. Today's FOMC meeting minutes suggest an increasingly cornered Fed will pull the trigger iun June with member disagreements brewing...

*MOST FED OFFICIALS SAW JUNE HIKE `LIKELY' IF ECONOMY WARRANTED
*FED: RANGE OF VIEWS ON WHETHER DATA WOULD SUPPORT JUNE HIKE”

VIX appears to be challenging its Cycle Top, but no breakthrough yet.

The VIX ETFs have all broken through their downtrend lines, as discussed this morning.

The Hi-Lo Index has broken beneath its 50-day Moving Average and appears to be capable of closing beneath it. We have had several false breaks already, but this is worth reporting due to the breakdown beneath critical support in the SPX.

TNX is going higher, primarily due to the probability that it has just made its Master Cycle low last Friday. The tight relationship between TNX and SPX appears to be breaking down. There may be more to report later this evening.

USD futures rallied to 95.14 at the Fed announcement. This gives the rally from the low seven waves, which is corrective. In addition, the trendline appears to be at 95.50, which means the downtrend channel hasn’t been broken. Keep that in mind as dollar strength wanes and a reversal to follow.

ZeroHedge has commentary.

Gold and crude both declined, but no critical supports were broken.

Regards,

Tony

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