Elliott Wave Stock Market Update - August 19

The ups and downs continue and we are now getting close to September and the market continues to trade in the same range as it has all year. Basically, 2039 needs break for a stronger correction to begin, otherwise this sideways action could arguably be a time correction. At the same time, the market needs to break out of the 2134 resistance if it is to reverse the imminent death cross coming in the next week or two. And to be clear, a death cross is a lagging indicator and there has been cases where the lows where already in by the time this event happened. However, more often than not, a death cross happens before new lows are in and with the historically worst month for the markets approaching (September), there's a good chance things will get very bearish.

I might be at Disney's California Adventures tomorrow, so again I might miss the update as an entire day out in the sun and making long lines drains me. But at the end of the day, seeing your child happy is priceless.

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 = 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 - August 17

The market is making things complicated by closing above its 50 DMA and re-capturing the Trend Average with today's rally. I don't picture a 5 wave count rally to new ATH but it's good to keep the possibility in mind given the bullish set up so far. We'll need to see more than a marginal new ATH to reverse the likely death cross coming to the SP500.

Tomorrow I will be in Disneyland all day so not sure I'll have time to update. I'll do my best to at least post a chart later tomorrow night.

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 - August 14

I'm going to make this one short since I had a busy day enjoying the summer here in So Cal. Basically, the market is making it harder to label the waves in the past couple of weeks by challenging the bearish trend. It'd be a lot easier if there was a strong sell off next week in all indexes but I get the feeling it's not going to be that easy. I guess after rallying almost 4 years, it's not easy for bulls to give up hope. And who knows, they might be able to pull a miracle but I wouldn't bet on it.

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 trend being challenged
Medium Term Trend = Bearish

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 - August 13

The market made a higher high today to test the Trend Average before going back down. I didn't want to label the waves before seeing the next move to get a better idea. A strong sell off tomorrow would make things easier as far as labeling goes but if the downsloping trendline is broken then it will open up bullish scenarios (As bullish as you can get with an impending death cross). Looking at possible targets for a potential bottom to a correction, I like the 1820-1900 support area which is about a 10-15% correction from the May high.

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 = Bearish

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 - August 12

The market made a lower low and changed the count I was following. Now that the trend is solidifying to the downside, I have to see what is the best count for the overall structure. Overall, the waves don't have an "impulsive" look to them due to all the zig zags/abc counts, including the wave today which staged a major reversal. But this is an inherent predictive flaw in wave theory (assuming 5 counts are always impulsive and zig zags are not), so I have to see what is the most likely overall count now considering there is a good chance of more downside ahead. The SP500 looks like it will have a death cross in the next week or two as well and we can start speculating for bottom targets once these waves are deciphered. Below is the chart I posted couple of weeks ago on the longer term count and tomorrow I will change the labels to reflect the likely LT W3 top the Fib targets.

Lastly, the recent change in sentiment is tied to the Chinese remimbi (or yuan). Which I think puts the Fed in a difficult spot. Up until Monday, the yuan was essentially pegged to the US dollar and had shared the burden of the appreciating dollar with the expectation of rising interest rates in the US. But now that they have decided to essentially go with the market and let the dollar do its own thing (like Japan, Europe and pretty much everyone), the US dollar finds itself alone and with strong market pressure to continue to appreciate. After all, why would Europeans, Japanese and countries with weaker currencies not buy dollars and park their money here now that interest rates are going higher here than in their QE/0% interest rate home banks. The Fed has to figure out how to fight this flood of foreign currency into the dollar as the more the rates rise, the stronger the dollar will become. As citizens, we get more purchasing power abroad (time to go on vacation!) but this leaves multi-nationals and export dependent businesses in a tough spot.

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 = Bearish

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 - August 11

The market sold off today but found support at 2076 before counter-rallying towards the end of the session. If yesterday's wave was a bullish W1 then we should see the start of a bullish W3 as soon as tomorrow. However, if the bullish count assumption is wrong then we could see a strong sell off wave in the next few sessions that will fall through all major support levels, specially 2039. The DJIA officially has a death cross (the media hasn't picked up on it but I'm sure we'll see people talk about it soon), again a first in 4 years and the assumption is lower lows are coming on that index and eventually all markets will end up following. The question now is how long will it take to reverse that death cross, the last one occurred in August 2011 and was not reversed until February 2012. If this is a LT W4, we might see a similar or shorter time frame. Lastly, now that China has decided to de-peg from the US dollar, a strong currency will be a drag on the US economy and its multi-nationals. This scenario lines up well with a LW W4 count, a stronger correction but not a bear market. Maybe a 10-15% correction at last?

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 = Bearish

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 - August 10

The market has rallied as expected and this could be a bullish W1 going by the current count. As I posted last week, the market is free to go for a new all time high after the correction. However, the imminent death cross in the DJIA will take a monumental bullish effort at this point. The DJIA has not seen a death cross since 2011 and this could be a signal of a major trend change in the broader market. Obviously, this signal could get whipsawed as any other market average signal. However, probabilities are on the high side there will be lower lows to come in the industrial index and my assumption is the SP500 will eventually be dragged by it. Whether this correction period turns into a bear market is another question but given the relentless uptrend for the past few years and the fact that waves are nearly complete, perhaps LT W4 is finally here.

Lastly, here's an article I just read that picks up on the notion that industrials will drag down the entire market.

http://www.forbes.com/sites/johntobey/2015/08/10/bear-market-probability-just-increased

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 = Bearish

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.