The market has finally sold off in what looks like the start of a stronger correction. The wave today looks clearly like a W3 and further downside is likely. We might see a bounce tomorrow or Monday and the key levels to watch are 1955-1962, a counter rally can not go past these levels. Also, if the market fails to recapture its 50 DMA in the next few sessions, the Intermediate Trend will turn bearish as well and that will be confirmation of a multi-week or even multi-month correction. There were several headlines today that caused the sell off, but it's not really clear to me which one was the main reason. One thing I found odd is that safety assets sold off too, which usually doesn't happen during a stock market sell off. One of the reasons I am in Gold was because I expected a Gold rally once the market found a top, but so far it hasn't moved all that much so we'll see.
Also, we issued our first ever short call yesterday on the new site we launched three months ago and it was very well timed. We are offering free trials, so feel free to check it out.
July 30th, 2014
The short term outlook continues to be bearish and now we see a potential count for stronger selling. We recommend traders with a higher risk tolerance to start building short positions with a stop at 1991.39
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 = Bullish
Long Term Trend = Bullish