Stock Market Update - June 12

The market sold off today and finally came back down to the Trend Average. For now, I am assuming this is an A wave and the market will be able to consolidate and rally again. However, if the market loses the TA then I will start entertaining downside targets. The market has a good excuse to sell now as oil is rallying, so what happens in Iraq and oil prices will probably be the main focus in the next few weeks. The interesting thing about oil is that I had been tracking an Ascending Triangle pattern for the past few weeks, with today being the break out of the triangle. In fact, it is the only asset I recommended to go long on the http://ewaveanalytics.com website since I started writing for it. So while Iraq is a legitimate excuse for an oil spike, the bullish pattern was there for quite some time. I just failed to think of an oil rally as the excuse for a market sell off.

May 17 update on EWA:

Oil has gone bullish on all its trends and looks like a good trading opportunity with a stop at $98.74

Unfortunately, my money was tied at that particular time but I bought USO today on the break out. What I didn't make on shorts (since I covered yesterday to position trade), I made on oil and will likely hold until I get a Trend Signal. And fundamentally speaking, the huge mess in Iraq is probably going to get worse as the ISIS, an offshoot of Al Qaeda, is preparing to battle for Baghdad. I can only imagine what a nightmare that will be if Iraq becomes a Caliphate. Ironically, the US supports removing the current Syrian government which is at war with the ISIS. If the Syrian government is toppled, my guess is that ISIS is going to take over too. The war on Iraq was a big mistake from the very beginning. It was a mistake going in, and it was a bigger mistake leaving the Iraqi government to fend for itself. The ISIS is going to make Saddam Hussein look like Gandhi.

Now, on a lighter note. Here is my prediction for the World Cup which I'm planning to watch for the next few weeks and which might delay my updates. The question for me is not so much who is going to win the WC but who is going to be in the finals against Brazil. The ideal will be Argentina vs Brazil in the finals (I have to check if Argentina falls in the opposing group), so basically an all South American final. I saw Brazil play today and I am sure Neymar and Oscar will be well known names by the end of the WC. What remains to be seen is how Messi plays this time in the Argentinean squad.

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.