Elliott Wave Stock Market Update - November 6

The market has continued to slowly grind its way to new all time highs. But without a decent pullback, buyers should exhaust sooner than later. There are some divergences among the main indexes and the market is obviously overbought, so in a "normal" situation we would see a correction in the next few days. However, given how manic buyers have become, this could continue to go on for a long while. This is the exact opposite of the panic from just 2 weeks ago, and what makes the past few weeks interesting is that all those excuses that caused the panic selling are still there. I am keeping my positions and now I'll have to position trade my hedge as the TA has now risen past my shorting price.

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 = 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.

Elliott Wave Stock Market Update - November 5

We had post-election rally today that came short of making a new all time high on the SP500, although the DJIA made a new all time high. So, the pattern of very shallow pullbacks might be repeating itself. At this point the market is clearly overbought and euphoria has taken over, but momentum is starting to wane and there are some divergences in short term oscillators that favor a bigger pullback in the next few sessions. But I am keeping my positions intact for the time being.

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 = 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.

Elliott Wave Stock Market Update - November 4

The market started another correction today as I had been hoping but it's not certain if we will get follow though selling.  Since the market started rallying couple of weeks ago at 1821, there has 6 similar corrective waves and not one of them evolved into a Zig Zags. So if the market manages to put in another lower low tomorrow, it will be the first "proper" corrective wave after this 10% rally. The headlines today focused on Oil's sell off, which finally reached the $77 level I had in mind for weeks (if not months), so we might see a counter rally there if $75 holds. Also, I am finally seeing some reasonable analysis on how beneficial the price of oil is to the US and other major economies as opposed to the bearish arguments few weeks ago. This drop in price is mainly due to the supply side, and $1 less at the pump translates into few hundred dollars per driver in the US every few months, so it is equivalent to an economic stimulus.  I read an analysis today on the impact of $80 oil that predicts the US will see an additional 0.4% in growth in  2 years and almost 1% in China. And the more the world economy grows, the better we all live and the higher the markets go. The ones that get screwed are the oil producing countries and oil companies.

I am still holding to my hedge, so hope we'll see the 50 DMA tested to get out of it even or with a small profit.

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 = 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.

Elliott Wave Stock Market Update - November 3

All the major indexes put in an intraday all time high with the exception of the RUT and this strengthens the bullish case for the next few weeks. I still expect a correction starting as soon as tomorrow if the high can hold but it could now just be a shallow pullback to the 50 DMA before the start of another bullish wave. The Nikkei is rallying almost 4% tonight, on top of the 5% from last week so if the sentiment carries over, then we could see the markets in the US rally non-stop for a while.

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 = 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.

Elliott Wave Stock Market Update - October 31

"every single time the market has been this oversold in the last two years, we've seen rallies to new all time highs. Will this time be different?"

I posted this on October 2nd and it looks like the pattern is repeating itself. Technically, the market made an all time high in pre-market and closed within a point of the all time high in the cash market. But on the DJIA and the Nasdaq, they both closed at new highs for the year (ATH in the DJIA). So it looks like the market will continue making new highs for the remainder of the year, with or without a pullback. If the market can correct to 1912-1925, we would have a big Inverse Head and Shoulder's set up with a target of 2220 and would fit in well with a Christmas and January rally. However, if the market punches through resistance again (2019), this wave could go parabolic to 2220 without a significant correction. The medium term signal has turned bullish, so now it is all clear for bulls. I am enjoying the longs I bought in the upper 1800's, but my hedge at 1973 is starting to worry me as I wasn't able to stop out at 1999 as the market gapped up towards the 2019 resistance this morning. Hopefully, I'll be able to get out of it without much damage by position trading or better yet on a correction towards the Trend Average.

The excuse for the rally today was the Bank of Japan's unexpected QE announcement, which helped push the Nikkei to a 52 week high. But the rally there was already in the works, so it's not really a surprise.  Also, China's SSEC is also at a 52 week high and challenging a multi-year resistance level. So we have the first, second and third largest economies in the world at 52 week highs. Which tells us, we might be seeing the start of another significant bullish run that will last for a while. The economies of Europe and commodity dependent countries (notably Russia) are not faring as well, but I don't think they will be able to stop the momentum being built up by faster growing economies. 

Have a great weekend and Happy Halloween!

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 = 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.

Elliott Wave Stock Market Update - October 30

The market was able to reverse all the losses from yesterday and challenge the 1999 resistance level, eliminating the bearish 1-2 set up and putting into question the V wave label. If the index overcomes 1999, there's a good chance the all time high will be challenged. Goes to show just how much the market was worried about the end QE. I am sure some excuse will come up soon for a correction or even a sell off, but in the end it will be just excuses to screw bears and panic sellers as this market has shown again and again for the last 2 years. Bears are probably between sore and numb at this point.. here's a chart to remind us of all the "panic attacks" this year.

But as I always say, it is about the economy! strong economy=strong profits=bulls win. Until the economy shows real deterioration or sharp increases in interest rates, the market will be pricing in profit growth.

I am holding on to my hedge but I might stop out if 1999 and try it again at 2019. I am sure the market is due for a pullback, but no point in fighting euphoria at this point.

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 whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.

Elliott Wave Stock Market Update - October 29

The market started to pullback today after finding a top at 1991. It is still too early to tell what sort of corrective waves are coming, but if the wave from 1991>1969 is a bearish W1 of an A, then the target is about 1945 or around the TA. However, if this is a simple ABC, then we're looking at 1960 as the end of a short term correction. I think it'd be better for the bullish case to make a stronger pullback to 1925, as sustainable rallies usually come after a good dose of fear. And now that QE is officially over and there is no sign of further QEs, maybe those traders who believe this market will crash because of the end of QE will start selling tomorrow? technically speaking, they should have started selling as soon as the news came out but maybe they're confused. I am glad the whole QE thing has been put to rest, as we will now find out if this policy was truly effective. If things are as stable as they seem, Bernanke will go down in history as an economic genius who saved the US from a depression. And he should get credit for it, given all the criticism he received during his tenure. I personally thank him or my cheap mortgage rates, we might not see rates this low again in decades.

Anyway, I will be lowering my stops to break even if the market goes below the 50 DMA and hopefully closing position at a profit on the TA test or at 1925.

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 whipsaws and I personally do not use nor recommend them to initiate or close positions in the market without taking into consideration other factors.