Weekend Stock Market Outlook

Stock Market Outlook entering the Week of January 10th = Downtrend 

MOVING AVERAGES

  • Short-term (20 DMA): Downtrend
    All the major stock market averages remained below their 20-day moving averages.
  • Intermediate (50 DMA): Downtrend 
    All the major stock market averages remained below their 50-day moving averages.
  • Long-term (200 DMA): Downtrend 
    All the major stock market averages fell or remained below their 200-day moving averages.

COMMENTARY
Not so happy start to 2016 if you’re long US equities.  Trading volumes came back in a big way, and came via a lot of selling.

Price/volume action confirmed the possibility discussed last week; the latest “uptrend” derailed  before it really started. OEW is firmly in the downtrend camp, although the bull market is still intact…for now.

We’ve returned to the discussions from late August and early September of last year.  Basically, if we fall below the August lows, the bull market is over, and it’s time to aggressively protect capital.  Hopefully you’ve been pruning away weak positions for some time now, and the latest volatility hasn’t had a large impact on your overall portfolio size.

For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  For price/volume data, head to stockcharts.com.

Moving Average Signals:

  • Uptrend=Market indexes remained above their moving average during the trading week
  • Downtrend=Market indexes remained below their moving average during the trading week
  • Buy signal=Market indexes rose above their moving averages during the trading week
  • Sell signal=Market indexes fell below their moving averages during the trading week
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