Weekend Stock Market Outlook

Stock Market Outlook entering the Week of April 23rd = Downtrend

  • 20/50 Day Moving Averages: Downtrend
  • Price & Volume Action: Mixed
  • Objective Elliott Wave Analysis: Downtrend

COMMENTARY
Not enough positive action to shift the overall outlook last week.  As mentioned, major political events have been the only thing to really impact the market over the past year or so.  We’ll have to see whether market reaction to the French election follows that trend.

2017-04-23 – US Stock Market Averages

Most of the indexes ended a second week below their 20 and 50 day moving averages.  In another show of strength, the Nasdaq rebounded and closed near record highs.  all the other indexes rose slightly, but only the Russell 2000 was able to close above a support level (i.e. 20 day).  Positive signs to be sure, but the outlook remains in a downtrend until we can retake the 50 day.

The only change to price/volume action was in the Dow, which added one day to its tally.  Overall, the S&P500 and DJIA have 8, the NYSE has 7, and the NASD has 4.  Not much activity from leading stocks either.  Bases continue to be built, which is a positive sign.

OEW remains in a downtrend, and key support levels are still a few percent away.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of April 16th = Downtrend

  • 20/50 Day Moving Averages: Downtrend
  • Price & Volume Action: Mixed
  • Objective Elliott Wave Analysis: Downtrend

COMMENTARY
Investors used the shortened trading week to take some money off the table, with U.S. stock indexes grinding lower.  Will last week’s hypothesis holds true? Will institutional investors step in and slowly rotate into new sectors?  For now, the outlook has changed to a downtrend while we await the answer.

$INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-04-16 – US Stock Market Averages

All the indexes ended the week below their 20 and 50 day moving averages, confirming a downtrend from a moving average perspective.  The “official” bull/bear support level (200 day moving average) is within striking distance.  The NASDAQ, being the strongest index of late, is naturally the most extended from the 200 day moving average, sitting ~7% above that level as of Friday.  Next is the DJIA at ~6%, the S&P at 4.5%, and the NYSE at 3%.

Following suit, price volume action also deteriorated.  Distribution days are elevated for all but the Nasdaq.  The S&P500 has 8, the NYSE and DJIA have 7, while the NASD only has 4.  The silver lining here is that trading volumes have been lower than average for the past few weeks, meaning that the selling is likely related to rebalancing holdings rather than outright liquidation.

That said, many of the leading stocks I follow have either broken key support levels or failed to break-out entirely, so we’ll have to wait and see which sectors are the new favorites.

OEW also changed to a downtrend, but restated the “good news”:

“When OEW signals a downtrend confirmed, it is likely that the correction will be nearly over. This kind of activity has happened quite often in the past 8 years”

OEW key support levels (measured on the S&P500) are just a few percent away.

The market averages are still close to their all time highs; the S&P sits ~3% off that mark.  Most of the downward price moves we’ve seen since 2016 have been right around 3%, with the two major exceptions being the run up to Brexit and the US Presidential election.  If the trend continues, the time we spend in this downtrend will be minimal.

 


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of April 9th = Uptrend 

  • 20/50 Day Moving Averages: Mixed
  • Price & Volume Action: Mixed
  • Objective Elliott Wave Analysis: Uptrend

COMMENTARY
A quick glance at the charts shows that most of the indexes have been in a shallow decline since early March.  The signs of selling are present, but not at high enough levels to change the outlook.  My hypothesis?  The shallow price declines indicate measured selling, as institutional investors slowly rotate sectors (most recently into the technology sector, as measured by the NASDAQ).  By the time a moving average or distribution day criteria is met, these investors have begun moving back in.

Last week still wasn’t great for a majority of the indexes from a moving average perspective.  After finding support the prior week, the NYSE and Russell 2000 ended last week below their 20 and 50 day moving averages.  The S&P500 and Dow Jones closed below their 20 day, but above their 50 day. And the Nasdaq continues to lead US markets, closing above both the 20 and 50 day moving averages.  Ideally, the Russell 2000 would lead the market higher, as it is composed of small cap stocks, which tend to be growth oriented.

$INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-04-09 – US Stock Market Averages

Price and volume action remains a cause for concern, with high-volume selling days elevated, but not yet extreme.

OEW uptrend signal remains in place, but the weekly post points out that price action over the past few weeks actually meets the technical definition of a downtrend (lower lows and lower highs).   As far as signal generation, OEW observed the following:

“When OEW signals a downtrend confirmed, it is likely that the correction will be nearly over. This kind of activity has happened quite often in the past 8 years”

This is the same phenomenon discussed in the 2016 performance review…most of the signals were generated at the tail end of a correction or downtrend.  That said, be on the lookout for market weakness; derailing a “recovery” doesn’t take much selling activity.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of April 2nd = Uptrend 

  • 20/50 Day Moving Averages: Mixed
  • Price & Volume Action: Mixed
  • Objective Elliott Wave Analysis: Uptrend

COMMENTARY
U.S. markets staged a mild recovery last week, but their advance wasn’t enough to change the market outlook.

The indexes found support and bounced off their 50 day moving averages.  The Nasdaq managed to recover its 20-day moving average, while the S&P500 and NYSE closed ~1 and 2 points below their respective 20 day moving averages.  The moving average outlook remains mixed by the smallest of margins.

$INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-04-02 – US Market Averages

Price and volume action muddled through last week; high volume selling remains elevated over the past month, reminding investors to err on the side of caution.

OEW uptrend signal remains in place.  With the uptrend recovery, the expectation is one more set of new highs before the next downtrend.  That said, be on the lookout for market weakness; derailing a “recovery” doesn’t take much selling activity.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of March 26th = Uptrend 

  • 20/50 Day Moving Averages: Mixed
  • Price & Volume Action: Mixed
  • Objective Elliott Wave Analysis: Uptrend

COMMENTARY
US markets sold off last week; with Tuesday providing a rare “outside-in” day on the S&P.  This event is created by prices reaching both a higher high and lower low than the previous trading day (rare).  It closed near the low AND on higher trading volume.

Speaking of rare events, the Tuesday price drop was 3 standard deviations larger than the average daily price spread for the last 50, 100, and 200 days.  You have to go back to Sept 9, 2016 to find another drop that large.  And on Sept 10, 2016 the market rebounded with an equally large move to the upside.  That did not happen this week, which suggests the markets are weaker this time around.

Candlestick Charts - US Markets

2017-03-26 – US Market Averages

The Russell 2000 is the first of the major indexes to enter a downtrend, closing below both the 20 and 50 day moving averages.  All the other indexes ended the week mixed; below their 20 day moving averages, while finding support near the 50 day.

Price and volume action also deteriorated last week, with the Tuesday sell-off highlighting institutional selling across all sectors and increasing the number of recent distribution days to a cautionary level.  Even the NASDAQ (a relatively strong performer lately) wasn’t immune, as it ended the week consecutive closing prices near the low for the day.  Combined with higher volume creates “stalling” price action.

Of course, this doesn’t mean that the rally is over; rather, it’s time to review your holdings, take some profits, and consider selling stocks that are showing weakness.

OEW uptrend signal remains in place, while acknowledging the signal is likely to change if the uptrend doesn’t resume this week.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of March 19th = Uptrend 

  • 20/50 Day Moving Averages: Uptrend
  • Price & Volume Action: Uptrend
  • Objective Elliott Wave Analysis: Uptrend

COMMENTARY
US markets rebounded last week, rallying on the 0.25% rate hike.  All the indexes are back above their 20 and 50 day moving averages.

Candlestick chart - US Stock Market Averages

2017-03-19 – US Stock Market Averages

Price and volume action remains positive; as mentioned last week, leading stocks continue to move sideways.  On the plus side, few are selling off on high volume, suggesting the rally still has some steam.

OEW uptrend signal also remains in place.   as we still need “higher highs” before the next correction.  Tony also reviews the “four-year Presidential cycle” as a method for forecasting major market lows.  As far as indicators go, it actually has a pretty good track record.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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Weekend Stock Market Outlook

Stock Market Outlook entering the Week of March 12th = Uptrend 

  • 20/50 Day Moving Averages: Mixed
  • Price & Volume Action: Uptrend
  • Objective Elliott Wave Analysis: Uptrend

COMMENTARY
US markets ran into a minor sell-off last week, ahead of this weeks Fed meeting. Expectations for a rate hike reached 90+%, and the odds of a June hike hit 50%.

The NYSE fell below it’s 20 day moving average, and the Russell 2000 took out both the 20 and 50 day moving averages.  The other three indexes (DJIA, S&P500, and Nasdaq) got a bounce at their respective 20 day moving averages and remain above their 50 day.

Candlestick chart for US Stock Market Averages

2017-03-12 – US Stock Market Averages

Price and volume action remains positive, but higher volume moves by leading stocks are few and far between.  This suggests more sideways action.

OEW uptrend signal remains in place, as we still need “higher highs” before the next correction.  That said, we reached an extreme high on the weekly RSI, which usually correlates some form of downtrend in the near future.


If you find this research helpful, please tell a friend. I share articles and other news of interest via Twitter; you can follow me @investsafely. The weekly market outlook is also posted on Facebook and Linkedin.

You can check out how well (or poorly) the outlook has tracked the market using past performance estimates:

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.


 

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