Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
CHIA Getting Started SSD Crypto Mining by Plotting and Farming on Your Hard Drives Guide - 9th May 21
Yaheetech Mesh Best Cheap Computer /. Gaming Chairs on Amazon Review - 9th May 21
Breaking US Trade Embargo with Cuba - Build 7 Computers in 14 Hours Before Ship Sales Challenge - 9th May 21
Dripcoin Applies New Technology That Provides Faster Order Execution - 9th May 21
Capital Gains Tax Hike News: Was It REALLY to Blame for Sell-off? - 7th May 21
Stock Market Transportation Index Continues To Grind Higher - 7th May 21
SPX Stock Market Correction Arriving or Not? - 7th May 21
How to Invest in an Online Casino? - 7th May 21
Gold & Silver Begin New Advancing Cycle Phase - 6th May 21
Vaccine Economic Boom and Bust - 6th May 21
USDX, Gold Miners: The Lion and the Jackals - 6th May 21
What If You Turn Off Your PC During Windows Update? Stuck on Automatic Repair Nightmare! - 6th May 21
4 Insurance Policies You Should Consider Buying - 6th May 21
Fed Taper Smoke and Mirrors - 5th May 21
Global Economic Recovery 2021 and the Dark Legacies of Smoot-Hawley - 5th May 21
Utility Stocks Continue To Rally – Sending A Warning Signal Yet? - 5th May 21
ROIMAX Trading Platform Review - 5th May 21
Gas and Electricity Price Trends so far in 2021 for the United Kingdom - 5th May 21
Crypto Bubble Mania Free Money GPU Mining With NiceHash Continues... - 4th May 21
Stock Market SPX Short-term Correction - 4th May 21
Gold & Silver Wait Their Turn to Ride the Inflationary Wave - 4th May 21
Gold Can’t Wait to Fall – Even Without USDX’s Help - 4th May 21
Stock Market Investor Psychology: Here are 2 Rare Traits Now on Display - 4th May 21
Sheffield Peoples Referendum May 6th Local Elections 2021 - Vote for Committee Decision's or Dictatorship - 4th May 21
AlphaLive Brings Out Latest Trading App for Android - 4th May 21
India Covid-19 Apocalypse Heralds Catastrophe for Pakistan & Bangladesh, Covid in Italy August 2019! - 3rd May 21
Why Ryzen PBO Overclock is Better than ALL Core Under Volting - 5950x, 5900x, 5800x, 5600x Despite Benchmarks - 3rd May 21
MMT: Medieval Monetary Theory - 3rd May 21
Magical Flowering Budgies Bird of Paradise Indoor Grape Vine Flying Fun in VR 3D 180 UK - 3rd May 21
Last Chance to GET FREE Money Crypto Mining with Your Desktop PC - 2nd May 21
Will Powell Lull Gold Bulls to Sweet Sleep? - 2nd May 21
Stock Market Enough Consolidation Already! - 2nd May 21
Inflation or Deflation? (Not a silly question…) - 2nd May 21
What Are The Requirements For Applying For A Payday Loan Online? - 2nd May 21
How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part1 - 1st May 21
INDIA COVID APOCALYPSE - 1st May 21
Are Technicals Pointing to New Gold Price Rally? - 1st May 21
US Dollar Index: Subtle Changes, Remarkable Outcomes - 1st May 21
Stock Market Correction Time Window - 30th Apr 21
Stock Market "Fastest Jump Since 2007": How Leveraged Investors are Courting "Doom" - 30th Apr 21
Three Reasons Why Waiting for "Cheaper Silver" Doesn't Make Cents - 30th Apr 21
Want To Invest In US Real Estate Market But Don’t Have The Down Payment? - 30th Apr 21
King Zuckerberg Tech Companies to Set up their own Governments! - 29th Apr 21
Silver Price Enters Acceleration Phase - 29th Apr 21
Financial Stocks Sector Appears Ready To Run Higher - 29th Apr 21
Stock Market Leverage Reaches New All-Time Highs As The Excess Phase Rally Continues - 29th Apr 21
Get Ready for the Fourth U.S. Central Bank - 29th Apr 21
Gold Mining Stock: Were Upswings Just an Exhausting Sprint? - 29th Apr 21
AI Tech Stocks Lead the Bull Market Charge - 28th Apr 21
AMD Ryzen Overclocking Guide - 5900x, 5950x, 5600x PPT, TDC, EDC, How to Best Settings Beyond PBO - 28th Apr 21
Stocks Bear Market / Crash Indicator - 28th Apr 21
No Upsetting the Apple Cart in Stocks or Gold - 28th Apr 21
Is The Covaids Insanity Actually Getting Worse? - 28th Apr 21
Dogecoin to the Moon! The Signs are Everywhere, but few will Heed them - 28th Apr 21
SPX Indicators Flashing Stock Market Caution - 28th Apr 21
Gold Prices – Don’t Get Too Excited - 28th Apr 21
6 Challenges Contract Managers Face When Handling Contractual Agreements - 28th Apr 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Counter-trend Rally

Stock-Markets / Stock Market 2017 Aug 28, 2017 - 10:36 AM GMT

By: Andre_Gratian

Stock-Markets

Current Position of the Market

SPX Long-term trend:  The uptrend should continue after pausing for a correction.

SPX Intermediate trend: An ending pattern appears to be in its last stages of completion.  This should be followed by an intermediate term correction into October.”  The correction has started.

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 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

 

Counter-trend Rally 

Market Overview:

After the 20-wk (40-wk?) cycle made its low on 8/21 (date adjusted from 8/10), SPX started a counter-trend rally -- or a b-wave, after the a-wave low of 2417, if you prefer -- and there is no conclusive sign that this rally is over.   Most of the short-term indicators are still biased upwardly, and until we break the 2430 level (minimum), the trend is still up.  If that is the case, the resumption of the uptrend should be early next week (perhaps Monday) and the index could reach 2479 before completing its retracement of the original decline to 2417.  I am presenting you with the most bullish picture for the short-term, but would not do so if it did not offer the best technical analysis probability.

Assuming this scenario will be realized, that would complete the b-wave of the correction, and it would be followed by the c-wave which should ideally extend into October.  Date-wise, the rally should conclude right around Labor Day.  Therefore, you should be ready for a reversal to occur, especially if SPX makes it to the target stated above determined by P&F and Fibonacci projections; and even if it does not! 

Analysis: (These Charts and subsequent ones courtesy of QCharts.com)

  • Daily chart 
  •  
  • I have made some notations on the chart which best explain where we are and what is expected of the index over the next few days and weeks.  It is a graphical representation of what is stated in the Market Overview.  After the rally from 2417, we rallied to 2454, or 50% of the distance from the to -- a normal retracement.  Then we declined to 2436, another “random” 50% of the rally to 2454.  We went on to retest the 2454 level and failed to surpass it by a fraction, which brought a little more selling.  This has taken us to Friday’s close of 2436, and at a point where the index needs to decide what it wants to do next. 
  •  
  • As also stated above, there is a bullish bias in the indicators, primarily in the A/D oscillator which only retraced to neutral on the pull-back from 2454.  It remains positive after the second pull-back into Friday and appears to be waiting for the other two to catch up.  We need for them to give a buy signal, even if it is only a brief one, to get the index above 2454 and start its move toward our 2479 target. 
  •  
  • The entire short-term index position is, at worst, neutral.  All the retracements have held where they should have, and the structural pattern is typical of a consolidation within our counter-trend rally.  So, until proven otherwise, another few days on the upside to finish the rally are expected.  But we’d better not tarry at this level or all bets are off, especially if we drop below 2430 and then 2417!  There is a 6-wk cycle low due right after Labor Day which typically waits until the last minute to bottom.
  •  
  •  
  • Hourly chart
  •  
  • The hourly chart is also neutral with a positive bias that comes primarily from its indicators, with, as it does in the daily chart, the A/D oscillator showing the most positive pattern.  In this case, the momentum is completely neutral, having tried to become positive on Thursday, but pulling back to the zero line on Friday.  You can see why the index must make up its mind by early next week. 
  •  
  • After Friday’s pull-back into the close, the index is sitting on a MA, trend and channel lines, parallels, support levels, and what not!  It would not be too cool if it penetrated all that on the downside.  If it did, you could probably kiss goodbye the scenario outlined above with a projection to the 2479 level.  Even if it held at the 2430 maximum retracement level, it would have made a mess of the beautiful structure we have so far, and created some doubt about what comes next!  Let’s hope the professional traders, who have some limited manipulative leverage over the market, keep it simple.
  •  
  •  
  • An overview of some important indexes (daily charts)
  •  
  • It is clear that all the indexes below are uniformly consolidating after rallying from their previous lows.  What is not clear is whether they will continue up from here and complete this rally at a higher level, or turn back down and continue the larger correction.  The oscillators at the bottom of the charts suggest that the move will be up instead of down.  The two usual leaders, TRAN and IWM appear to support this view:  TRAN is showing positive divergence, and IWM has already started an uptrend in its oscillator.
  •  
  •  
  • UUP (dollar ETF)
  •  
  • No strength in UUP.  The best we can hope for is that this is a retest of the low and that it will start forming a base.  The worst is that it will make a new low.
  •  
  • GDX (Gold Miners ETF)
  •  
  • After struggling at the 23.00 level for about a week, GDX took advantage of the weakness in UUP to finally push to 23.50.  While that does not represent a forceful break-out, it may have mitigated a protracted decline into its upcoming cycle low.
  •  
  • Note: GDX is now updated for subscribers throughout the day, along with SPX.
  •  
  • USO (United States Oil Fund)
  •  
  • As suggested last week, USO appears to be building a small consolidation pattern which will eventually result in a challenge of its secondary top channel line. 
  •  
  •  
  • Summary
  •  
  • Expectations are that the rally from 2417 has a little more to go, possibly to 2479, before the secondary (intermediate) trend resumes.
Andre

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