QUICK UPDATE: The weekly S&P 500 (SPX) chart produced a bearish price flip and now the key chart will be the SPX daily chart. The daily SPX is on a TD Buy Setup @2. If the SPX can puncture the 2425.53 TDST Support level either at the close of Monday or Tuesday’s trading, then a case can be made for a trend change to bearish.
The US Dollar Index (DXY) had all the ingredients to trend higher, but something happened in late 2016. Even though the monthly DXY was well into the TD Sell Countdown phase, it was halted with a bearish engulfing candlestick on January 2017. Looking closer at the weekly DXY in January 2017, after recording a TD Sell Setup @9, the DXY powered higher, but not enough to take out the risk level around the 103 level. The DXY subsequently sold off. Currently the weekly has taken out the 95.422 TDST Support level which is now suggesting even a lower dollar. The DXY is expected to eventually take out long term support established since May of 2015. This is easily seen on the monthly chart.
For the S&P 500 (SPX), consolidation with a bullish bias is still supreme unless the weekly SPX can turn bearish by closing below 2459.27. Close below the daily TDST Support at 2425.52 will especially be a problem.
NOTE: This could be the last post until late September. If time permits, a short quick update may come up.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Neutral until further notice
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BULLISH
Neutral if weekly SPX closes below 2459.27 on Friday, August 11, 2017
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Neutral if monthly SPX closes below 2384.20 on Thursday, August 31, 2017
Some cracks in equities last week, but there will be no technical damage as long as the S&P 500 (SPX) meanders above the 2420 – 2425 level. One of the cracks was demonstrated by the daily Nasdaq Powershares QQQ (QQQ). It produced a large bearish engulfing pattern last Thursday, in part attributable to the weekly price exhaustion signals.
The same can be said of the Russell 2000 (RUT). However, if the RUT begins to show leadership higher, it could really take off as the weekly RUT chart is showing a long volatility squeeze that has been building up for weeks.
A note for commodity watchers, The monthly chart for copper futures (HG) recorded a TD Buy Setup @ 9 on February 2016 above the 1.506 TDST Support level, and for the close of this month, copper reached the first hurdle by surpassing the 2.767 TDST Resistance level. This will be construed as bullish. Should it trade below the TDST level, further analysis is needed.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Neutral until further notice
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL
Bearish if weekly SPX closes below 2425.18 or Bullish if the close is above 2472.54 on Friday, August 4, 2017
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Neutral if monthly SPX closes below 2362.72 on Monday, July 31, 2017
QUICK UPDATE: The S&P 500 (SPX) has now recorded both TD Sell Setup @ 9, and TD Sell Countdown @ 13 on the daily chart. With new highs everywhere on various indices, and the weekly chart price flipped bullish, any pullback could just well be temporary. A bearish stance will be considered if the new TDST Support at 2425.53 can be challenged or if the weekly SPX can record a bearish price flip.
Markets remain ultra resilient. However, it’s still not a certainty another bull leg higher is taking place. The daily Powershares QQQ (QQQ) has recorded a TD Sell Setup @ 9, and trading this week will determine if it can lateral to TD Sell Countdown. With the weekly QQQ at price exhaustion levels, the new high last week is not enough to switch to bullish quite yet.
Same with the S&P 500 (SPX), the daily chart is one higher high away from recording a TD Sell Setup @9, and two notches away from recording a TD Sell Countdown @13. However, with the fresh highs made last week, the odds of another leg up are growing. If equity markets are to make any meaningful price correction of 10% or time correction of more than a couple weeks of trading consolidation, then it needs to start showing signs it will happen this week.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Neutral until further notice
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL
Bearish if weekly SPX closes below 2423.41 or Bullish if the close is above 2472.54 on Friday, July 28, 2017
The Powershares QQQ (QQQ) was on a TD Buy Setup @ 7 before Friday’s jobs numbers, but the rally was good enough to end Friday’s session with a bullish price flip. The inability for the Q’s to record a TD Buy Setup @ 9 suggests market indecision. The Nasdaq Composite (COMP) recorded two of three bars closing under the 6121.29 TD Support level before price flipping bullish. This also aligns with the Q’s supporting a directionless market.
Projecting forward for all indices, but using the Nasdaq and the S&P 500 (SPX) as prime examples, weekly charts are at price exhaustion levels. Strong rallies should be capped. From daily charts, all the TDST Support levels have been challenged, but there has been no selling follow through. Everything continues to suggest range bound trading. However, directional bias is not static as volatility could come this week. There are hosts of potential catalysts with the beginning of earnings season and Janet Yellen’s testimonies to the House and Senate.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Neutral until further notice
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH
Neutral if weekly SPX closes above 2433.15 on Friday, July 14, 2017
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Neutral if monthly SPX closes below 2362.72 on Monday, July 31, 2017
The Nasdaq Composite (COMP), which is trading at TD Buy Setup @4, is still holding above the 6121.29 TDST Support level. If this continues, it would be easy to say a price rally will soon follow. However, the related index, the Powershares QQQ (QQQ), has its daily chart showing the same count, TD Buy Setup @4, except the Q’s are trading well below the TDST Support level at 138.78. This would suggest the Q’s would continue to trade lower and lateral into TD Buy Countdown from TD Buy Setup. If that is he case, it would make sense the Nasdaq COMP would follow the same path and easily trade below the 6121.29 level, and take everything down including the S&P 500 (SPX). However, this s not exactly a case where one index follows another. Here is what to expect using both the COMP and QQQ.
If the QQQ trades to a TD Buy Setup @9, and the COMP never closes below the 6121.29 level then we can expect another rally to follow. (Actually, the COMP can close below the 6121.29 level, but we’ll deal with that if it gets there)
If the QQQ price flips bullish before TD Buy Setup reaches a @9, and the COMP never closes below 6121.29 level, then everything resets again and range bound trading should dominate.
If the COMP should close below the 6121.29 level, there will be a bearish inclination, but could be subdued due to the COMP having a mature TD Buy Setup count. This will require further analysis.
Based off these scenarios, short term clarity is still not there. Longer term, the weekly COMP suggests any rally will be capped.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH
Neutral if daily SPX closes above 2419.38 on Monday, July 3, 2017
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL
Bearish if weekly SPX closes below 2431.77 on Friday, July 7, 2017
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Neutral if monthly SPX closes below 2362.72 on Monday, July 31, 2017
 | Gary on Monday, July 31, 2017 |
| Gary on Monday, July 31, 2017 |
 | Art on Thursday, July 27, 2017 |
| Gary on Thursday, July 27, 2017 |
| Art on Monday, July 10, 2017 |
