Friday, March 28, 2014

Market Update

The market decided to break the triangle to the upside and the 50 day ma remains untested (in the cash market) despite several bearish attempts in the last few weeks. In fact, despite a bearish Daily MACD crossover which is one of my preferred tools in anticipating important trend changes, the market closed around the same level as it did when the signal first occurred. And if I remember correctly, this is the first bearish Daily MACD crossover that has failed to test the 50 DMA in a long time. So what this tells me is the market is forming a base to rally past 1900 sooner rather than later if support continues to hold.

The latest waves have been somewhat hard to label but what looks clear to me is that we've seen an ABC move since the all time high. The length of the wave I've labeled C is exactly the same as the A wave. Today's gap up had the look for a bullish micro W3 but it faded into W1 territory, so this implies we will see another ABC move or today's top was W1. Either way, the bulls are showing their resiliency.

I didn't trade today as I don't want to take unnecessary risks given the bearish TA and support levels holding. My China positions have done very well this past week and hopefully I will add more China and possibly Russia in the next couple of weeks. I heard Putin called Obama today (which is rare, usually it's the other around) so perhaps this will give reasons to global markets to rally with joy early next week.

Have a Great Weekend!

Short Term Trend = Bearish
Medium Term Trend = Bullish
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 whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.

No comments:

Post a Comment