Weekend Stock Market Outlook

Stock Market Outlook entering the Week of September 24th = Uptrend

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

COMMENTARY
The market signals are still coming up green, with no changes to the overall signal set.  What I can I say?  Low volatility (measured by the $VIX) and falling dollar make for boring updates to the market outlook.

All the indexes remain above their 20 and 50 day moving averages to kick off the week.

Price charts for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-09-24 – US Stock Market Averages

Distribution days continue to drop off the count, putting the indexes in more “robust” territory.  The Russell 2000 has staged an impressive climb since hitting its 200 day moving average, showcasing leadership from small caps (a positive sign).  Also, more leading stocks broke out last week; trading volume has been just good enough.

OEW continues to show an uptrend in progress.


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 September 17th = Uptrend

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

COMMENTARY
One small change in the signal set as all 3 start this week in an uptrend.  It looks like neither hurricanes nor North Korea can stop this bull.  Eventually, something will wear it out.  But until then, it’s rally on.

All the indexes start the week above their 20 and 50 day moving averages.

Price charts for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-09-17 – US Stock Market Averages

New price highs combined with higher trading volume to give us a welcome signal last week in the form of accumulation. And that puts the markets in a strong position to start this week.  Most leading stocks are still extended from proper buy points, so be on the lookout for new leadership to emerge (maybe cyclicals).

OEW confirmed an uptrend last week as the markets broke to new highs.


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 September 10th = Uptrend

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

COMMENTARY
No change from last week’s signal set, but the price action doesn’t leave us with that warm, fuzzy feeling.  We did see trading volume return, but so did sellers.  Traders brushed off North Korean concerns and one hurricane.  Will Hurricane Irma (and potentially Jose) stop this bull market?

The Nasdaq and S&P500 begin the week above their 20 and 50 day moving averages.  The Dow starts this week above the 50 day, but below the 20 day.  And finally, the Russell 2000 is below the 50 day, but above the 20 day.  With a majority of the indexes above their 50 day, we’ll keep the uptrend signal in place for this week.

Price Trends for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-09-10 – US Stock Market Averages

Most of the indexes added a distribution day to their already elevated count.  Given this environment, it shouldn’t be surprising that most leading stocks that have broken out haven’t made much progress.  Even more concerning is the lack of trading volume during those breakouts.  Ideally, you’d like to see volumes at least 50% higher than average.  That said, these stocks aren’t breaking down either.

Given the lack of progress by leading stocks, it probably also isn’t surprising that OEW continues to show the market at an inflection point.  We continue to wait for a break of key support levels to know which way this market is headed.


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 September 2nd = Uptrend

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

COMMENTARY
Aggressive buying on Thursday put the markets in good position to kick-off September trading, and the outlook has regained uptrend status.  There are still reasons for concern, so we’ll look to this week’s trading action for more concrete direction.  In the US, the weeks starts with the markets closed for Labor Day.

All the indexes begin this week above their 20 and 50 day moving averages.   Even the Russell 2000 joined the party, bouncing back from it’s recent weakness and climbing out of bear market territory.

Price Action for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-09-02 – US Stock Market Averages

Last week was definitely an accumulation week, as trading volume rose with prices.  And there were even a few breakouts.  So we can change the outlook back to an uptrend.  That said, I am still cautious though, as the price patterns for a majority of leading stocks (i.e. stocks with the best fundamentals) are still under construction.  Most are have had substantial run ups since November of last year, and are just beginning to form new bases.  The markets still have a high distribution day count over the past 4 weeks as well.  If we see another strong showing this week,

OEW shows the market at an inflection point, so we could see prices go either direction.  I’ve tried to be definitive this year (uptrend or downtrend), but there really isn’t’ a clear direction from OEW right now.  We just have to watch price action unfold.

Typically, this week also marks the end of summer vacation season; hopefully we’ll see a return of trading volume.  As mentioned last week, September is a notoriously weak month in terms of return.  Combine these traits, and I expect the markets will cross their moving averages a few times, meaning we’ll likely see changes between uptrends and downtrends as we work our way through the month.


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 August 27th= Downtrend

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

COMMENTARY
A strong showing last Tuesday put stock indexes above their 50 day moving averages, but they failed to hold that level by Friday’s close.  So this week starts with the downtrend intact.

All the indexes begin this week under their 20 day moving averages.  Aside from the DJIA, they’re all under their 50 day moving average as well.  The Russell 2000 remains in bear market territory, starting the week below its 200 day moving average.

Price Action - $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-08-27 – US Stock Market Averages

No change in the price/volume action last week, so we start this week with the downtrend signal.

OEW still shows a probable downtrend, but continues to wait for confirmation.  As mentioned last week, declines during this bull market have been short-lived after an OEW confirmation.

Last week didn’t see any changes in the price action of growth names that made my selection screen (base failures, low-volume breakouts that subsequently failed), so I continue to watch and wait.  None of this is really surprising; August and September have been the worst two months of the year for stocks, over the last 29 years, based on the average monthly price change


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 August 20th= Downtrend

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

COMMENTARY
As expected, the markets bounced back early last week, but trading volume was lacking.  Prices retreated on Thursday, and with most of the indexes below key moving averages and even more institutional selling, the overall market outlook remains in a downtrend this week.

The Russell 2000 continues to lead markets lower, falling below it’s 200 day moving average and entering bear market territory.  That’s no the best sign, considering that market leading stocks are typically small capitalization stocks.  The DJIA remains the last man standing, so to speak.  But even it couldn’t withstand the selling, closing below it’s 20 day moving average last week.  The Nasdaq, S&P500, and NYSE all being this week below their respective 20 and 50 day moving averages.

Price chart for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-08-20 – US Stock Market Averages

The market indexes added another distribution day or two, along with some stalling action (large price spread, low closing price), so the downtrend signal remains in place.

OEW switched over to a downtrend.  If past is precedence, the downtrend should end soon, as declines during this bull market have been short-lived after an OEW confirmation.

Continuing the recent trend of after-hours price declines (see here and here), last week it was Walmart’s turn to get “Amazoned”.  On the positive side, WMT’s price volatility was nowhere near as bad as what we witnessed with NVDA.

Most of the growth names that made my selection screens over the past few weeks have experienced:  outright base failures, low-volume breakouts that subsequently failed, or are in the process of forming base-on-base patterns.

If you’re sitting on profit, remember that you never want a gain to turn into a loss.  Book some of your profits (>20% gain).  Not quite there?  Take a serious look at your stocks chart and set some short term triggers.

If we are entering a correction, it’s a great time to look for stocks that are already forming bases and don’t get derailed by market sell offs.  These stocks will be the ones that lead the market higher when the correction completes.


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 August 13th = Downtrend

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

COMMENTARY
With all the indexes below key moving averages and high levels of institutional selling (in the form of distribution days) clustered over the past two weeks, the overall market outlook shifted to downtrend this week. These periods are usually short lived, so hopefully we’ll see some strength return this week and the indexes will retake key support levels.  In the meantime, investors can take some profits and/or cut mediocre performers loose (see analysis of Nvidia ($NVDA) recent price action below).

It sure seems like the indexes have rolled over, with the Russell 2000 leading markets to the downside, pushing this signal into downtrend territory.  Last Sunday, all the major indexes except the R2K remained above their 20 and 50 day moving averages.  This week, only the DJIA remains at those levels; all the other indexes closed the week below their 20 and 50 day moving averages.  The Russell actually reached its 200 day moving average…any further declines and that index is in bear market territory.

Price Action for $INDU,$NYA,$SPX,$USD,$COMPQ,$CRB,$RUT,$GOLD

2017-08-13 – US Stock Market Averages

The price/volume indicator also switched to downtrend, price levels are below the 50 day moving average and distribution days are high for all indexes (7 for the S&P500, NYSE, DJIA, and Nasdaq).

OEW remains in an uptrend, although several potential scenarios are under consideration.

Revisiting last week’s commentary on the recent difficulty holding new positions through earnings, NVDA crushed their earnings on Thursday, raising revenues by 56%, and EPS increasing 124%!  For a stock that has performed so well over the year, to see such a massive earnings beat is surprising.  And after hours, the stock tanked, and continued to fall into Friday’s trading session (currently, talking heads are attributing this to lower than expected revenues in one of their operating segments).

The stock had recently attempted a break-out, so investors looking to initiate a position likely came away frustrated. But this goes back to the point that the markets can stay irrational longer that you can stay solvent.  Whatever the reason for the price action, it happened.  Prices move against you sometimes, and for you at others.  The key is to make sure that you aren’t destroyed when things don’t work out the way you or anyone else thinks they should.


Thoughts on Nvidia ($NVDA)

Fundamentally, the company is sound; sales and earnings have steadily increased, debt is manageable.  Technically, the latest chart pattern wasn’t great for entering new positions, but I’ve seen worse.  Warning signs were there, in the form of weak price action.  Usually this price action precedes an earnings miss, or some other bad news (and a subsequent sell-off).  Not the case with Nvidia.  In fact, given the size of the top and bottom line performance, the situation was ideal for a massive gap up!

Nvidia’s stock price was up 176% over the past 12 months (at Thursday’s close).  It had already broken out a couple times this year, so new bases are more likely to meet increased selling as investors book gains.

2017-08-13 - NVDA - Daily Chart

2017-08-13 – NVDA – Daily Chart

The price pattern cup shape wasn’t symmetrical, met the minimum timeframe of 6 weeks, and trading volume was low as the right side of the base was built in early July.  The stock actually broke out of the base on July 21st, (just barely), but trading volume was below average, and the stock price meandered sideways.  August 7th saw another attempt to rise above resistance at $170, but again, lack of volume showed little conviction from large players.

Looking at the weekly chart puts the sell-off in perspective for buyers of the May breakout.  For all the commotion last week, NVDA sits at the 50 day moving average. Investors with existing positions are likely monitoring price action closely and considering taking profits.

2017-08-13 - NVDA - Weekly Chart

2017-08-13 – NVDA – Weekly Chart


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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