Elliott Wave Stock Market Update - December 12

The market put in another bearish micro 5 wave count today to test the 50 DMA as I had been expecting when the daily MACD rolled over.  Today's wave could be another A of a zig zag or W1 of a W3, so the picture of the correction is not entirely clear just yet. The excuse for today's sell off was oil, but like I said yesterday, my guess is that a bottom is coming up very soon (which I might trade). The drastic drop in prices at the pump just translates into more discretionary spending so this whole thing is basically an excuse to sell. There is a study that was done by Barclays where they compare the additional discretionary spending vs the capital spending that would have resulted from oil co's companies. And the projection is an increase in GDP due to low oil prices. I am personally saving around $70 per month on gas (which is probably in line with the average driver in the US), so I am enjoying this price war between OPEC and Shale Oil.

http://www.hellenicshippingnews.com/low-oil-prices-may-boost-global-growth-outlook-barclays/

Anyway, I decided to sell half of my hedge at the end of the day but I was a few minutes too late. So I am holding to the entire hedge position over the weekend along with my longs. My guess is that we are seeing a double zig zag that will end next week, or just in time for a big Santa Rally. Last but not least, the now formed Inverted Head and Shoulders pattern on the daily targets 2267 so we could see a very bullish period if the pattern follows through.. never underestimate xmas/new years euphoria.

Have a great weekend!

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

* 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 - December 11

The market put in a decent rally early morning to almost test the TA again before heading back down. So far we have an ABC move completed, which could also be part a nested bearish 1-2 count. So unless we see strong selling soon, we will likely see the start of a new rally or a zig zag and then the start of a rally. With Oil now trading in the high 50's, odds are a bottom is getting close (for Oil) and sellers will need to find another excuse to sell. Also, we have to keep in mind that all that money consumers have been saving on gas, will likely end up being spent shopping and in turn provide a profit boost to major companies going into 2015. So chances are high we will get a strong end of the month and a strong January.

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

* 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 - December 10

The closest the market got to the TA was at the closing yesterday and today the sell off continued in what is possibly a C or a W3. As I mentioned when the MACD rolled over last week, it is very likely we will see the 50 DMA tested and that level is currently at 1993 so not all that far from where the market is now. However, should the selling accelerate, then the 200 DMA would be a better target at 1944 but that would be a stretch considering the season we are in. And like I said last week, a correction this week would set up the market for a Santa rally so while we might see further downside, the market could be making new all time highs in couple of weeks. The excuse has been China and Oil, but China will probably cut rates very soon and Oil will find a floor possibly in the 50's, so sellers will need better excuses to make their case.

I was hoping to buy VXX at the TA test but since the market didn't get there, I ended up buying back SH to hedge longs. I decided to keep my longs since they're China centric and I am betting a rate cut is coming.

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

* 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 - December 9

The market followed though on its wave count and the Trend Average has finally turned bearish. It seems like it took forever, but better late than never. What remains to be seen is how high the counter rally will go and the pattern that it will create. I can see the possibility of a flat or something that will challenge the TA but not overcome it on the bearish side. However, if the market can rally to the high then it could set itself up for an IHS. Given the history of this market making very quick corrections and rallying, this shouldn't come as a surprise.

I ended up selling my hedge at a profit near the low today and will evaluate the long position in this counter rally. I am also planning to get the hedge (or maybe even short) near the TA in hopes the signal will not get whipsawed.

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

* 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 - December 8

The market sold off today as expected in what looks like a potential micro 5 wave count. If the labels are correct, we should see another leg to test the 2050 support and possibly set up a neckline for a Head and Shoulders. If there's going to be a substantial correction, it should start right now so the market can position itself for a Santa Rally. So we'll see if the Trend Average turns bearish after being bullish for 7 straight weeks.

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


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 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 - December 5

The market found resistance and support today in the rising wedge trendlines, so we might see the market break out of the rising wedge on Monday or Tuesday. If the market can sell off to 2050 and bounce from there, we could get a Head and Shoulders. Which would fit well with the bearish MACD rollover and the fact that this market has rallied 14% without any significant correction. If the bulls manage to break the wedge to the upside, then 2100 will be the next stop but I doubt it at this point.. that would be insanity. 

Have a great weekend!

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 - December 4

We got another marginal higher high on the SP500 today and the bearish 1-2 count was invalidated. It seems like we could be seeing another rising wedge as the market is facing overhead resistance so unless these upper levels are cleared soon, we will see the 2050 low tested. With that said, there is also an Inverse Head and Shoulders targeting 2101 so we need to see the TA turn bearish soon or else we will see more upside. I am keeping my positions intact as I am enjoying the strong rally in China (which seems to be in the early stages of a multi-year bull market) and hedging with VXX.

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.