Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Silver Notches Best Month Since 1979 - 12th Aug 20
Silver Shorts Get Squeezed Hard… What’s Next? - 12th Aug 20
A Tale of Two Precious Metal Bulls - 12th Aug 20
Stock Market Melt-Up Continues While Precious Metals Warn of Risks - 12th Aug 20
How Does the Gold Fit the Corona World? - 12th Aug 20
3 (free) ways to ride next big wave in EURUSD, USDJPY, gold, silver and more - 12th Aug 20
A Simple Way to Preserve Your Wealth Amid Uncertainty - 11th Aug 20
Precious Metals Complex Impulse Move : Where Is next Resistance? - 11th Aug 20
Gold Miners Junior Stcks Buying Spree - 11th Aug 20
Has the Fed Let the Inflation Genie Out of the Bottle? - 10th Aug 20
The Strange Food Trend That’s Making Investors Rich - 10th Aug 20
Supply & Demand For Money – The End of Inflation? - 10th Aug 20
Revisiting Our Silver and Gold Predictions – Get Ready For Higher Prices - 10th Aug 20
Storm Clouds Are Gathering for a Major Stock and Commodity Markets Downturn - 10th Aug 20
A 90-Year-Old Stock Market Investment Insight That's Relevant in 2020 - 10th Aug 20
Debt and Dollar Collapse Leading to Potential Stock Market Melt-Up, - 10th Aug 20
Coronavirus: UK Parents Demand ALL Schools OPEN September, 7 Million Children Abandoned by Teachers - 9th Aug 20
Computer GPU Fans Not Spinning Quick FIX - Sticky Fans Solution - 9th Aug 20
Find the Best Speech Converter for You - 9th Aug 20
Silver Bull Market Update - 7th Aug 20
This Inflation-Adjusted Silver Chart Tells An Interesting Story - 7th Aug 20
The Great American Housing Boom Has Begun - 7th Aug 20
NATURAL GAS BEGINS UPSIDE BREAKOUT MOVE - 7th Aug 20
Know About Lotteries With The Best Odds Of Winning - 7th Aug 20
Could Gold Price Reach $7,000 by 2030? - 6th Aug 20
Bananas for All! Keep Dancing… FOMC - 6th Aug 20
How to Do Bets During This Time - 6th Aug 20
How to develop your stock trading strategy - 6th Aug 20
Stock Investors What to do if Trump Bans TikTok - 5th Aug 20
Gold Trifecta of Key Signals for Gold Mining Stocks - 5th Aug 20
ARE YOU LOVING YOUR SERVITUDE? - 5th Aug 20
Stock Market Uptrend Continues? - 4th Aug 20
The Dimensions of Covid-19: The Hong Kong Flu Redux - 4th Aug 20
High Yield Junk Bonds Are Hot Again -- Despite Warning Signs - 4th Aug 20
Gold Stocks Autumn Rally - 4th Aug 20
“Government Sachs” Is Worried About the Federal Reserve Note - 4th Aug 20
Gold Miners Still Pushing That Cart of Rocks Up Hill - 4th Aug 20
UK Government to Cancel Christmas - Crazy Covid Eid 2020! - 4th Aug 20
Covid-19 Exposes NHS Institutional Racism Against Black and Asian Staff and Patients - 4th Aug 20
How Sony Is Fueling the Computer Vision Boom - 3rd Aug 20
Computer Gaming System Rig Top Tips For 6 Years Future Proofing Build Spec - 3rd Aug 20
Cornwwall Bude Caravan Park Holidays 2020 - Look Inside Holiday Resort Caravan - 3rd Aug 20
UK Caravan Park Holidays 2020 Review - Hoseasons Cayton Bay North East England - 3rd Aug 20
Best Travel Bags for 2020 Summer Holidays , Back Sling packs, water proof, money belt and tactical - 3rd Aug 20
Precious Metals Warn Of Increased Volatility Ahead - 2nd Aug 20
The Key USDX Sign for Gold and Silver - 2nd Aug 20
Corona Crisis Will Have Lasting Impact on Gold Market - 2nd Aug 20
Gold & Silver: Two Pictures - 1st Aug 20
The Bullish Case for Stocks Isn't Over Yet - 1st Aug 20
Is Gold Price Action Warning Of Imminent Monetary Collapse - Part 2? - 1st Aug 20
Will America Accept the World's Worst Pandemic Response Government - 1st Aug 20
Stock Market Technical Patterns, Future Expectations and More – Part II - 1st Aug 20
Trump White House Accelerating Toward a US Dollar Crisis - 31st Jul 20
Why US Commercial Real Estate is Set to Get Slammed - 31st Jul 20
Gold Price Blows Through Upside Resistance - The Chase Is On - 31st Jul 20
Is Crude Oil Price Setting Up for a Waterfall Decline? - 31st Jul 20
Stock Market Technical Patterns, Future Expectations and More - 30th Jul 20
Why Big Money Is Already Pouring Into Edge Computing Tech Stocks - 30th Jul 20
Economic and Geopolitical Worries Fuel Gold’s Rally - 30th Jul 20
How to Finance an Investment Property - 30th Jul 20
I Hate Banks - Including Goldman Sachs - 29th Jul 20
NASDAQ Stock Market Double Top & Price Channels Suggest Pending Price Correction - 29th Jul 20
Silver Price Surge Leaves Naysayers in the Dust - 29th Jul 20
UK Supermarket Covid-19 Shop - Few Masks, Lack of Social Distancing (Tesco) - 29th Jul 20
Budgie Clipped Wings, How Long Before it Can Fly Again? - 29th Jul 20
How To Take Advantage Of Tesla's 400% Stock Surge - 29th Jul 20
Gold Makes Record High and Targets $6,000 in New Bull Cycle - 28th Jul 20
Gold Strong Signal For A Secular Bull Market - 28th Jul 20
Anatomy of a Gold and Silver Precious Metals Bull Market - 28th Jul 20
Shopify Is Seizing an $80 Billion Pot of Gold - 28th Jul 20
Stock Market Minor Correction Underway - 28th Jul 20
Why College Is Never Coming Back - 27th Jul 20
Stocks Disconnect from Economy, Gold Responds - 27th Jul 20
Silver Begins Big Upside Rally Attempt - 27th Jul 20
The Gold and Silver Markets Have Changed… What About You? - 27th Jul 20
Google, Apple And Amazon Are Leading A $30 Trillion Assault On Wall Street - 27th Jul 20
This Stock Market Indicator Reaches "Lowest Level in Nearly 20 Years" - 26th Jul 20
New Wave of Economic Stimulus Lifts Gold Price - 26th Jul 20
Stock Market Slow Grind Higher Above the Early June Stock Highs - 26th Jul 20
How High Will Silver Go? - 25th Jul 20
If You Own Gold, Look Out Below - 25th Jul 20
Crude Oil and Energy Sets Up Near Major Resistance – Breakdown Pending - 25th Jul 20
FREE Access to Premium Market Forecasts by Elliott Wave International - 25th Jul 20
The Promise of Silver as August Approaches: Accumulation and Conversation - 25th Jul 20
The Silver Bull Gateway is at Hand - 24th Jul 20
The Prospects of S&P 500 Above the Early June Highs - 24th Jul 20
How Silver Could Surpass Its All-Time High - 24th Jul 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Stock Market Time for Caution? 

Stock-Markets / Stock Markets 2020 Jul 20, 2020 - 09:38 PM GMT

By: Andre_Gratian

Stock-Markets

Current Position of the Market

SPX Long-term trend:  For now, the best guesstimate is that we are still in the bull market which started in 2009.

SPX Intermediate trend:  We should be approaching an important high, with confirmation coming over the next few days.

Analysis of the short-term trend is done daily with the help of hourly charts. It is an important adjunct to the analysis of daily and weekly charts which discuss 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 let me know at anvi1962@cableone.net

 Time for Caution? 

Long Term:  With the degree of recovery that SPX has made from the March low, it is likely that the 2192 was only wave 4 of the bull market which started in 2009. 

Important cycles

36-td cycle 7/09 - The 40-wk cycle (~7/20) is apparently inverting – 45-td cycle ~8/14 -

Market Analysis (Charts courtesy of QCharts)

SPX- IWM weekly charts

  • Next week could be a transition point for the stock market because:
  • Many of the programs which have sustained workers, small businesses and renters will soon end.  Congress is still not unified on replacing them.
  • The 40-wk cycle is peaking (instead of making a low) and about to reverse.
  • The NDX, which has sustained the advance in SPX may already have peaked at 269.   StockCharts has a bearish P&F projection for QQQ (259) to 236.  This matches a .382 retracement from the March low to 230. 

Next week could be a reality check for the stock market which, since its March low, has been unconcerned with the economic uncertainties that lie ahead.  Last week SPX pierced through its former rally high by a fraction.  The momentum could carry it slightly higher next week.  If this is all it does before reversing sharply, it will most likely be a sign that the rally has come to an end and that we have started a correction.  TRAN is still lagging.

SPX daily chart

On Monday of last week, SPX overcame its June high by two points and was immediately shoved back over a hunded points.  It tried again on Wednesday and managed to add another three points, but could go no higher and fell back.  Friday, SPX saw a crawling rally which reached 3233, but could not close on its high.  It is clear that the former high is being defended by sellers, but hope that something positive could come over the weekend kept prices near their highs.  Next week will be a very important time slot for the stock market because of the reasons stated above.  I should point out that the momentum oscillators are overbought and showing deceleration, but do not show the negative divergence which is normally a prerequisite for a reversal.  Only the A-Ds have been showing divergence for the past two weeks.  Nevertheless, the index is in need of a positive catalyst to keep it going higher.  If that does not come, we could see the beginning of a correction of the uptrend which started in March.  If, as claimed by Hadik that the 40-wk cycle is making a high instead of a low (something which is obvious enough by now), the odds favor a downward path once it has peaked.

Up to this point, all short-term P&F projections (except for the 3230 target which brought about a 108-point reversal and has yet to be exceeded) have only had a minimal impact on prices.  The next level to watch is 3250-3260.

SPX hourly chart

Since Monday’s reversal from the 3230 P&F target, followed by a rally back to that level, the index has done little,  perhaps waiting for more vaccine successes or another relief bill from congress.  The oscillators are on hold as well, with negative divergence in both momentum and breadth.  There is not much more that can be said beyond what was said above, and we must wait for a resolution to the current market condition. 

The projection to 3250-60 could buy us a little more time, but the immediate path of the market will be determined by the action of the NDX which appears to have topped for now and is in the process of creating a congestion pattern.  Ever since mid-April, SPX has bounced off its 200-hr MA six times!  The MA is currently at 3114 which is also an important support level.  Dropping below it would signal the start of a correction. 

  • UUP (dollar ETF) 
  •  
  • It does not look as if the 3-mo cycle has been able to support UUP.  There could still be hesitation at this level, but new lows are likely.  USD, which is trading at 95.86 has a short-term projection to 94-93. 
  •  
  •  
  • GDX (gold miners)
  •  
  • GDX has a near-term projection of ~40.  If correct, reaching that price would lead to a reversal and correction, but since there are much higher eventual projections, it should be limited in time.
  •  
  •  
  • PAAS (Pan American Silver Corp)
  •  
  • PAAS should get to 35+ before reversing and consolidating in conjunction with GDX.
  •  
  •  
  • BNO (U.S. Brent Oil fund)
  •  
  • BNO is ready to pull back along with the market.  It needs to retest its low and create a base.
  •  
  • Summary
SPX shares some of the high-tech stocks with NDX (and QQQ).  The latter has been the primary engine propelling SPX to its current level.  So, purely on a technical basis, if QQQ has already made an intermediate high, it stands to reason that SPX will shortly follow suit.  StockCharts has a bearish projection of 236 for QQQ in the coming correction.  Based on Friday’s close, I can project 233 if QQQ resumes its correction without making some additional congestion at this level. 

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

6 Critical Money Making Rules