Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Why Most Investors LOST Money by Investing in ARK FUNDS - 27th Jan 22
The “play-to-earn” trend taking the crypto world by storm - 27th Jan 22
Quantum AI Stocks Investing Priority - 26th Jan 22
Is Everyone Going To Be Right About This Stocks Bear Market?- 26th Jan 22
Stock Market Glass Half Empty or Half Full? - 26th Jan 22
Stock Market Quoted As Saying 'The Reports Of My Demise Are Greatly Exaggerated' - 26th Jan 22
The Synthetic Dividend Option To Generate Profits - 26th Jan 22
The Beginner's Guide to Credit Repair - 26th Jan 22
AI Tech Stocks State Going into the CRASH and Capitalising on the Metaverse - 25th Jan 22
Stock Market Relief Rally, Maybe? - 25th Jan 22
Why Gold’s Latest Rally Is Nothing to Get Excited About - 25th Jan 22
Gold Slides and Rebounds in 2022 - 25th Jan 22
Gold; a stellar picture - 25th Jan 22
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Resuming the Major Downtrend?

Stock-Markets / Stock Markets 2020 May 05, 2020 - 10:10 AM GMT

By: Andre_Gratian

Stock-Markets

Current Position of the Market

SPX: Long-term trend – We are in an official bear market

Intermediate trend – resuming decline?

Analysis of the short-term trend is done on a daily basis with the help of hourly charts.  It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends


Daily market analysis of the short-term trend is reserved for subscribers.  If you would like to sign up for a FREE 4-week trial period of daily comments, please go to www.marketurningpoints.com and request a trial.

 Resuming the Major Downtrend? 

Point & Figure Overview of SPX

Intermediate trend:  2930 was exceeded by 20 points.  Rally top?  We need a congestion pattern to establish next count.

Important Cycles

Next 80-day cycle due ~6/08 

Market Analysis (Charts courtesy of QChart)

SPX-IWM weekly charts 

Last week, SPX reached a little beyond its projected target of 2930 and reversed sharply, closing near its low of the week.  IWM rallied as well, tried to close an open gap but failed; it also closed near the low of the week.  Next week’s action could be significant because more selling pressure is expected from a bottoming short-term cycle as well as from negative economic reports.

SPX daily chart

SPX surpassed its 2930 projection by 20 points before reversing and plunging 134 points in the next two days.  The index closed near its low on Friday, suggesting that the decline is probably not over, especially since the cycle low is ideally due in the middle of next week. 

This reversal most likely puts an end to the 763-point bear market rally from mid-March and signals the start of the next phase of the downtrend which started from 3393.  It is possible that after additional selling into next week, we could rally into about mid-May before the next reversal.

So far, the decline in prices has only created a strong sell signal in the hourly indicators.  But of the daily indicators, only the SRSI has turned negative while the A-Ds are close to doing the same.  If there is enough additional weakness CCI will join the other two under the zero line and we will have a confirmed intermediate sell signal.

SPX hourly chart

The decline from 2955 occurred without any significant bounce going into Friday’s close.  I have marked on the chart the ideal time frame when the minor cycle should make its low, but a reversal could be short-lived. 

Note that the decline took the index below the 50-hr MA in one fell swoop, thus creating a strong sell signal in all three oscillators.   A return to bullishness would require that the oscillators move back to positive, usually with at least a trace of positive divergence making its appearance first.  Since there is none, another two or three days down into the cycle low (and probably beyond) can reasonably be expected.

UUP (dollar ETF) daily

UUP has established a trading range above its 200-dma.  Friday’s decline has taken it back down to it once again, and UUP must hold at this level or risk rolling over into the next 3-m low which does not come until the end of June.

GDX (Gold miners ETF) daily

GDX needs to continue to rebound above 34, or risk correcting down to 28.50.

PASS (Pan American Silver Corp.) daily

PAAS continues to model its trading after GDX.  It’s in the same fix!

BNO (U.S. Brent oil fund) daily

BNO may be starting a base between 6 and 8. 

Summary

The ISM non-manufacturing PMI is due on Tuesday morning, and this could be a good time for a near-term cycle low.  However, a rebound could be short-lived, since next Friday investors will have to face some extremely poor job numbers.

Andre 

FREE TRIAL SUBSCRIPTON

For a FREE 4-week trial, send an email to anvi1962@cableone.net, or go to www.marketurningpoints.com and click on "subscribe". There, you will also find subscription options, payment plans, weekly newsletters, and general information. By clicking on "Free Newsletter" you can get a preview of the latest newsletter which is normally posted on Sunday afternoon (unless it happens to be a 3-day weekend, in which case it could be posted on Monday).

Disclaimer - The above comments about the financial markets are based purely on what I consider to be sound technical analysis principles uncompromised by fundamental considerations. They represent my own opinion and are not meant to be construed as trading or investment advice, but are offered as an analytical point of view which might be of interest to those who follow stock market cycles and technical analysis.

Andre Gratian 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