Tuesday, July 30, 2013

Market Update


The market seemed like it was on its way to break out of its range early morning but the bullish wave got stopped at the IHS neckline trend and reversed to test the low from yesterday and managed to put in a slightly higher low. Which technically still keeps a 5 wave count alive on the SP500, however the DOW made a lower low so it will be interesting to see how these two counts will end up reconciling. The market could be putting in a triangle or just getting ready for stronger wave down but I think it all comes down to the 1676-1682 level holding. If this level holds, the market should make an all time high soon. With that said, the daily MACD is about to roll over on the daily so any new high will likely be reversed. Lastly, today is the second day the marker closed under the Trend Average so the Short Term trend will go negative should a stronger bearish wave appear.

I ended up buying back VXX at a much better price at the break of the micro 5 wave count (1687) and sold the longs I bought yesterday for a minor profit. And the plan is to buy longs again at the test of support again or just buy the other 50% of my short position if a break out wave appears. A bigger correction is coming sooner rather than later.

Main S&P 500 Trends*

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.

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