The Safe Investing Blog

Market Outlook entering the Week of October 5th = Confirmed Downtrend

Short-term (20 DMA): Downtrend
All the major stock market averages closed below their 20-day moving averages.

Intermediate (50 DMA): Downtrend
Other than the Dow Industries, all the major stock market averages closed below their 50-day moving averages.

Long-term (200 DMA): Uptrend
The current bull market [March 2009 – Present] continues.

Market Commentary
As noted mid-week, William O’Neil’s Big Picture analysis switched from an uptrend under pressure to a full blown correction, and Objective Elliott Wave confirmed an intermediate downtrend.

Although unlikely, the market could recover and reverse course.  If trading can push the S&P500 past the 1,973 and 1,986 pricing levels, we might have a shot at another decent uptrend.

Elliott Wave Analysis from Elliott Wave Update by Tony Caldaro

US Stock Market Averages – (c) stockcharts.com

Market Outlook Update for the Week of September 28th = UnConfirmed Downtrend

Market Commentary
The high volume selling over the past few days was enough for William O’Neil’s Big Picture analysis to switch gears from an uptrend under pressure to a full blown correction.

From an Elliott Wave perspective, the magic number for confirming a downtrend was S&P 1,973.  At yesterday’s close, the S&P sat at 1,972, which was too close to call.  But today’s drop made quick work of any uncertainty regarding a correction, as the S&P violated yet another key mid-term pricing level.

Needless to say, now is NOT the time to buy stocks or use margin.

Elliott Wave Analysis from Elliott Wave Update by Tony Caldaro

2014-10-01 – US Stock Market Averages

Market Outlook entering the Week of September 28th = Unconfirmed Downtrend

Short-term (20 DMA): Downtrend
All the major stock market averages fell below their 20-day moving averages during the week.  The Dow was able to reclaim that level on Friday, but just barely.

Intermediate (50 DMA): Downtrend
All the major stock market averages either tested or fell below their 50-day moving averages.

Long-term (200 DMA): Uptrend
The current bull market [March 2009 – Present] continues.

Market Commentary
William O’Neil’s Big Picture analysis showed an uptrend under pressure for the entire week.  The long term Objective Elliott Wave uptrend from Tony remain intact, but the mid-term uptrend is under siege.

Revisiting last week’s commentary, the S&P500 level of 2,011 was a bridge too far.  We passed 1,991, meaning the probability of a correction is high. Per Tony:

Clearly the current pattern, technical indicators, and some specific indices favor the bearish scenario.

Rather than looking for confirmation of another uptrend, we’re now looking for confirmation of the next downtrend, which is expected to last 2-3 months and cover 20-30%.  S&P 1,973 is the magic number for confirming said downtrend.

If you haven’t already, check your sell signals.  Remember: Keep your losses small, and live to invest another day.

Elliott Wave Analysis from Elliott Wave Update by Tony Caldaro

2014-09-27 – US Stock Market Averages

Market Outlook entering the Week of September 21st = Unconfirmed Uptrend

Short-term (20 DMA): Uptrend
With the exception of the NASD, all the major stock market averages closed the week above their 20-day moving averages.

Intermediate (50 DMA): Uptrend
With the exception of the NYSE, all the major stock market averages continue to trade above their 50-day moving averages.

Long-term (200 DMA): Uptrend
The current bull market [March 2009 – Present] continues.

William O’Neil’s Big Picture analysis flip-flopped last week, moving from a confirmed uptrend, to an uptrend under pressure, and then back to a “confirmed uptrend”.  The medium and long term Objective Elliott Wave uptrends from Tony remain intact.

The NYSE did retake the 50-day moving average, which is a positive sign.  Revisiting last weekends S&P500 price levels:

1. 1,905 – The S&P500 remained ~5% above this level
2. 2,011 – On Thursday, the S&P500 closed at 2011.36, and on Friday we closed at 2010

Since the S&P wasn’t able to breach the 2,011 level, the “high probability” of an extended uptrend wasn’t confirmed, which is a negative sign.  We’ll have to see if we can bust through that level next week.

Tony’s analysis narrowed our confirmation windows a bit:

1. 1,991 – If we fall to 1,991, the probability of a correction is high
2. 2,011 – If we rise above 2,011, the probability of a continued uptrend is high

Elliott Wave Analysis from Elliott Wave Update by Tony Caldaro