Friday, January 23, 2015

Elliott Wave Stock Market Update - January 23



















The market started a correction as expected and technically should at least test the 50 DMA before the next bullish leg. So far it looks like an ABC move for a W4 and we should find out early next week. The ideal count for a C&H pattern would be a W2 for the handle, but we'll see if this micro count works. There are elections this weekend in Greece and this is perhaps the excuse to move the market on Monday. Some people worry about the implications of Greece leaving the EU, some say it won't be that big of a deal. Technically speaking, the Greek economy is relatively small at $260 billion. To put that into perspective, the US and China added about $1 trillion dollar each to their economies last year or 8 Greek economies in just 12 months. So if anything, it is more about the integrity of the EU as a union.

I am holding my oil position, so I hope the market will respect the 44.20 bottom and rally to its 50 DMA. Whatever the case, I'm sure the supply side is making adjustments with prices this low.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish trend being challenged
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw

Thursday, January 22, 2015

Elliott Wave Stock Market Update - January 22




















The market rallied today as expected after the European Central Bank announced QE, which in itself was not really a surprise. The price action confirms the double bottom at 1988 and officially turns the Trend Average to the bullish side. In addition, there is  now cross over on the daily MACD, a close over the 50 DMA and a potential Cup and Handle pattern forming that targets 2,140. I expect a pullback to test the Trend Average or the 2038 support level to consolidate gains in the next session or two. But I wouldn't be surprised if the run continues given all the non-stop rallies in the last 3 years after significant bottoms.

I ended up buying oil again given the clear stop level at last week's low. Perhaps it will finally start a counter rally to its 50 DMA.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bullish
Medium Term Trend = Bearish trend being challenged
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw

Wednesday, January 21, 2015

Elliott Wave Stock Market Update - January 21




















The market had a bearish opening but nonetheless ended up rallying the rest of the day. closing above the Trend Avg and possibly following a bullish nested 1-2 count. Given the ECB announcement will be on Thursday (before the market opens in the US), the bullish count looks like a strong possibility since QE would be bullish for equities. The TA is technically bullish already since the number is going slightly up, but I wanted to get 2 closes above it before confirming a turn. After 3 weeks of selling, the market is basically just 3% off all time highs and oscillators have been reset so no one should be surprised if there's a huge bull run for the next few weeks.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish trend being challenged
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw

Tuesday, January 20, 2015

Elliott Wave Stock Market Update - January 20




















The market closed right below the Trend Avg again and it has a potential to gap up or rally tomorrow in a bullish W3 that will bring the TA back to positive if the move is strong enough. It seems like traders are starting to price in QE in Europe, so we'll find out in a couple of days. Obviously, if the ECB disappoints (I don't see why they wouldn't implement QE under the circumstances) then the markets will find the excuse to re-visit the double bottom. But other than that, I don't really see much of an excuse for a deeper sell off at the moment. Some people were focused on China's 7% "crash" on Monday, but it seems like they did not notice the 70% rally since the low last year without much of a correction. I remain fully invested in China and I actually hope the SSEC will come down to 2600-2800 so I can exchange my H share holdings for A shares. I am betting the SSEC will eventually go into a bubble by trading close to multiples seen in 2007 (PE 45 vs PE 12 today). Most people have not yet fully grasped the size of the Chinese economy and the potential for its stock market to become the biggest in the world. In my opinion, it's just a matter of when and not if given current trends.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish trend being challenged
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw

Friday, January 16, 2015

Elliott Wave Stock Market Update - January 16




















The market bounced from the 1988 resistance level today and rallied the rest of the day, possibly in a double bottom to the most recent structure. If we see follow through buying next week that re-captures the Trend Average at 2023, there's a good chance the market will go back to bullish mode again. Oil seems to be confirming a bottom with today's rally over its Trend Avg and it's too bad I was stopped out yesterday during the retracement wave. If the rally in oil continues, the stock market will probably rally along as well and probably to a new all time high. Every time the market has been this oversold, we have seen new all time highs in the past 2+ years and most recently in December. I don't remember how many times its been already but I think this is the 7-8th time the market has reached this oversold level since Feb 2012. Obviously, at some point the market will roll over for a substantial correction. But personally, I don't see oil, copper, Greece or Switzerland stopping this uptrend. I think it will take "real" negative news to get momentum to the downside.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw
 


Thursday, January 15, 2015

Elliott Wave Stock Market Update - January 15




















The price action was highly volatile overnight with futures up by more than 20 points before reversing gains during the normal hours due to a surprise move by the Swiss to abandon their currency peg to the Euro. With this move, the Euro will probably challenge its all time low against the dollar at 1.05 if I remember correctly. Anyway, as far as the US market, things are still not looking very promising and I think a 200 DMA test needs to happen to really test the bulls. The count continues to be the same, so the market just needs to find its bottom.

My oil position was looking great when I woke up early morning to set stops. But by the time I woke up again my stops were already triggered, so I ended up even on the trade. Still, my longs in China are doing really good and I am almost there. Technically speaking, I just need China to go up another 20% to SSEC 4000 and its H shares in HK to reflect its true value and that will be it. And once that rally exhausts, maybe it will be time to give Brazil and Russia a shot as those markets are cheap and will likely get even cheaper.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw

Wednesday, January 14, 2015

Elliott Wave Stock Market Update - January 14




















The market continued its downtrend today and it has now eliminated the potential bullish 1-2 count that had been in place since the market bounced from 1992. But given the invalidated bearish counts on the other indexes, I lean towards labeling this move from the 2093 high a zig zag. Which implies this is a correction and a new all time high will be coming once the market finds a bottom. If we ignore the other indexes, then this wave on the SP500 would a bearish W3 that would fit well with the Head and Shoulders targeting the 1880 area. But you just can't ignore the waves on the other markets.

Oil spiked today, the strongest one day bullish move in almost 3 years. Which favors my view that oil would be finding a bottom this week after waves exhausted themselves. Still, the rally needs confirmation and that will be trade over $48.60 on WTI. If a bottom is found there, then bears will have to turn to copper for further excuses to sell. But again, copper is just another excuse so don't be fooled by the panicky headlines. The article below explains it;

http://www.businessinsider.com/chinese-copper-demand-falls-2015-1 

My position in oil is now back to green. So I expect to adjust my stop on a follow through rally to oil's Trend Average.

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit http://www.ewaveanalytics.com


Short Term Trend = Bearish
Medium Term Trend = Bearish
Long Term Trend = Bullish

* Trends are not trade signals. Trends are posted for situational awareness only and does not take into account wave counts, technical or fundamental conditions of the market. While mechanically trading the posted trends is feasible, keep in mind that these are lagging indicators and as such are prone to whipsaw