Market Outlook entering the Week of October 12th = Confirmed Downtrend
Short-term (20 DMA): Downtrend
All the major stock market averages ended the week below their 20-day moving averages.
Intermediate (50 DMA): Downtrend
All the major stock market averages ended the week below their 50-day moving averages.
Long-term (200 DMA): Downtrend
All the major stock market averages ended the week at or below their 200-day moving averges.
What a week! The markets were all over the place, but all that volatility couldn’t stop the downward slide. Hopefully, you’ve taken the appropriate actions to capture profits and preserve capital.
William O’Neil’s Big Picture and the Tony Caldaro’s Objective Elliott Wave analysis continued to show a market in correction.
The market’s last hope to return to an uptrend is a slim one. In the September 13 weekend update, 1,905 was a key support level for the S&P500. Friday’s close put us at 1906 and some change.
Market action will ultimately determine when the markets turn around, but here are some other support levels to watch in the S&P500:
- 1738 (~9% drop from Friday’s close)
- 1627 (~15% drop from Friday’s close)
- 1560 (~18% drop from Friday’s close)
Now it is the time to dust off those watch lists and start looking for your next buys.
Elliott Wave Analysis from Elliott Wave Update by Tony Caldaro