Friday, April 17, 2015

Elliott Wave Stock Market Update - April 17

I wasn't expecting the market to sell off and break 2083 as it did today. But then again, the waves were looking suspicious because of lack of bullish momentum. Given this seemingly range-bound market, I suspect there's some sort of triangle at the intermediate level taking place which will end up breaking very soon. And considering the long term trend has been bullish for over 3 years and the bearish MACD cross on the monthly time frame, perhaps this is finally the time for the market to take a break and make a 10% correction if not a bit more. Strength in oil and general economic conditions (which IMO are fairly ok) will make any sell off in the stock market a consolidation phase before another sustained rally to new highs. So maybe "Sell in May" came couples of weeks sooner?

One of the causes for the sell off today was the curbing of margin trading in China, which in recent weeks has been going up like no tomorrow or 13% in 2 weeks to be exact. Just last month ago I was at 70% of my retirement goal, yesterday's close put me at 87% of my goal. The rise has been so fast, it has exceeded my own best expectations or any possible wave count (I'm actually in disbelief how fast this has happened). So maybe there will be a sell off there to consolidate before going much higher, which will coincide with a world wide correction period that includes Europe as well.

I ended up closing my oil position for a profit and bought back my VXX from last week. I expect a bounce early next week in stocks but I think it's time to start betting for another change of trend.

Have a great weekend!

For further analysis on the NASDAQ, DJI, RUT, Gold, Silver and Oil please visit

Short Term Trend = Bullish trend being challenged
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 whipsaw

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