Monday, February 8, 2016

Even though the Nasdaq Composite (COMP) has been taking some huge hits lately, chart wise, it is very similar to the S&P 500 (SPX). From the weekly chart, the Nasdaq just needs to ‘perfect’ the existing TD Buy Setup by recording a print at 4313.39 or lower. Chances are, it will do so above the marked TDST Support level at 4075.70. Much like the SPX’s 1850.61 TDST Support level, this provides some clues that an all out bear market is not ready to begin just yet. Besides the Nasdaq, there are many related indices such as XOI, JNK, EEM, PEK that are recording 9’s and 13’s on their respective weekly and monthly charts.  Screen Shot 2016-02-06 at 9.17.37 AM


S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL

Bullish if four -hour SPX closes above 1915.18. 

Screen Shot 2016-02-06 at 9.02.18 AMThe SPX could not breakaway from the 1934.47 TDST Resistance level. Looking forward, it looks like it may try again as TD Buy Countdown and TD Combo Buy are approaching 13’s.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL

Bearish if daily SPX closes below 1850.61. 

Screen Shot 2016-02-06 at 8.46.30 AMA bullish counter-trend rally could not materialize. Therefore, it is back to the beginning and watching to see if the 1850.61 can hold.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if weekly SPX closes above 1880.33 on Friday, February 12, 2016.

Screen Shot 2016-02-06 at 8.31.25 AMNothing has really changed over the course of last week’s trading. The bearish momentum is still intact. However, the weekly SPX is still holding above the 1850.61 TDST Support level, which favors the bullish side.


S&P 500 (SPX) LONG TERM OUTLOOK: NEUTRAL

Bearish if monthly SPX closes below 1850.61, the weekly TDST Support level on Monday, February 29, 2016. 


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Monday, February 1, 2016

Looking at biotechnology with the monthly chart of the iShares Nasdaq Biotechnology Index ETF (IBB), which is correcting after a multi year run, the interpretation is straightforward: If the IBB can continue the downward momentum, and slice under the 242.36 TDST Support, this will reinforce the downtrend and see much lower prices. On the flip side, if IBB can continue to close above 242.36 in the next few months, a reversal could be in the works.Screen Shot 2016-01-30 at 6.00.53 PM

For the S&P 500 (SPX), both bulls and bears should continue to be frustrated as the SPX stays non-committed. The current environment calls for a counter trend higher. Bears will have their way if the SPX sells through 1850.61.


S&P 500 (SPX) SHORT TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1903.63, same as daily bearish price flip. 

Screen Shot 2016-01-31 at 7.50.31 PMA close above the 1934.47 TDST Resistance level bodes well going forward. However, it will be better to receive solid confirmation with the next two closes above that 1934.47 level.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BULLISH

Neutral if SPX closes below 1903.63 at close of day.

Screen Shot 2016-01-30 at 7.42.31 PMThe same TD Sell Setup/TDST Resistance exercise applies again. If TD Sell Setup records @9, and below the 2078.36 TDST resistance level, then we can look at the downside again.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1922.03 on Friday, February 5, 2016.

Screen Shot 2016-01-30 at 6.41.16 PMA completed “9” count TD Buy Setup above the 1850.61 TDST Support level paints a far less bearish picture. Expectations are for the SPX to make a counter move higher, which can start if the weekly SPX can close out at 1922.03 or higher.


S&P 500 (SPX) LONG TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1850.61, the weekly TDST Support level on Monday, February 29, 2016. 

Screen Shot 2016-01-30 at 6.24.14 PMThe monthly SPX chart: Is it a topping process or is it just relieving the excess bullishness before going higher. We will stick with the latter, but this time we are open to the bearish end if 1850.61 is demolished to the downside. Note the TTM_Squeeze is still coiling, and the 8 month MA is intersecting the 21 month MA.


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Thursday, January 28, 2016

QUICK UPDATE: The FOMC said what it needed to say today. Unless the S&P 500 (SPX) can quickly slice through 1850.61, the weekly TDST Support, it’s a bit of a challenge to be overtly bearish short term at this time. On the four hour SPX chart, the second price exhaustion signal, TD Buy Countdown, is one count away from a ’13’. With this price action occurring above 1850.61, the tendency here is to chop higher. Note that even though the recent closing bar’s close is lower than the low of the previous two bars, TD Buy Countdown @13 will be deferred until the SPX is equal to or lower than bar 8’s close as illustrated in the chart. Screen Shot 2016-01-27 at 8.56.28 PM


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Monday, January 25, 2016

Once again we present the Wayne Whaley “Turn of the Year” barometer, which is similar to other January barometers except this one bookends dates from November 19 to January 19. The predictive value is shown in the chart below.Screen Shot 2016-01-24 at 8.01.10 PMThe interpretation goes like this: When the S&P 500 (SPX) performance between November 19 to January 19 is 3% or more, the probability is overwhelming bullish for the remainder of the year. If the performance is between 0-3%, then it’s a mixed bag with a bullish edge. When the performance is negative, the bears get the upper hand. This Turn of the Year barometer or TOY barometer is helpful in keeping the overall perspective of expectations during the year. For example in 2015, a -1.57% November 19, 2014 – January 19, 2015 performance gave a lot of weight that 2015 would be the year that the SPX would not be as bullish as the previous years. The SPX closed barely positive. Now looking at the present and the future, November 19, 2015 to January 19, 2016, the SPX performance tracked a 9.17% loss, the worst ever recorded since it was first tracked in 1951. This magnifies the odds for a bearish 2016.

Continuing on the prospects of 2016, the SPX is currently holding up relatively well despite huge currency adjustments, falling commodity prices, and the big slide in oil. The long drawn out sideways price action looks to continue. To change this, the primary focus is on China. Market participants know China needs to correct itself, and the SPX is willing to stay on the sidelines until it is satisfied China will not crash and burn. The monthly SPX is coiling and it is ready for a catalyst that will either propel the SPX to even greater heights or quickly unwind downward. 2016 looks pivotal.


S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1881.63, same as Daily Outlook.

Screen Shot 2016-01-22 at 8.02.09 PMThe bearish case may seem a bit aggressive considering the turnaround that just occurred last Wednesday, January 20, but there is an unfinished TD Buy Countdown and TD Combo Buy counts that suggest another low is not out of the question. A closing bar above the designated TDST Resistance at 1934.47 would provide the SPX the capacity of a higher price retracement off the lows.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL

Bearish if SPX closes below 1881.33.

Screen Shot 2016-01-22 at 8.19.51 PMWhile the SPX is processing the potential low, we’ll give the bearish side the benefit of the doubt if it the SPX reasserts itself with a bearish price flip. If it can successfully retest the low, a bullish case can be considered.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 2043.94 on Friday, January 29, 2016.

Screen Shot 2016-01-22 at 8.29.27 PMThe weekly SPX has recorded nearly all the necessary ingredients for a price exhaustion low – a ‘perfected’ TD Buy Setup above the TDST Support at 1850.61. What happens on the final ‘9’ count this week will help determine if a bullish outlook is in the cards.


S&P 500 (SPX) LONG TERM OUTLOOK: NEUTRAL

Neutral until further notice. 


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Thursday, January 21, 2016

QUICK UPDATE: On the four hour S&P 500 (SPX), it has recorded the first of three price exhaustion clusters. The first being the TD Buy Setup @9 indicated by the up blue arrow. the others are TD Combo Buy, which is one count away from recording a ’13’, and TD Buy Countdown, which is two bars away form a ’13’. With today’s aggressive selling and the subsequent comeback above the weekly SPX TDST Support at 1850.61, the signs for a soft capitulation are in. Furthermore on the daily chart, the closing candlestick bar closed with a classic reversal bar, the Hammer. For some validation that the market slide is over, follow the daily SPX. Momentum is still strong on the downside, and will remain that way until a bullish price flip (closing higher than the close of the previous four bars) is recorded.  Screen Shot 2016-01-20 at 6.33.39 PMScreen Shot 2016-01-20 at 6.38.19 PM


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Tuesday, January 19, 2016

A bad week for equities. The S&P 500 (SPX) is driving near the suggested target at 1850.61, the weekly TDST Support. It is at a point where multiple timeframes on the SPX will find support at 1850.61 for at least an interim bottom. All is needed is for the SPX to record at least one more lower low at or below 1857.83, and close the week on Friday above 1850.61. That would be the most bullish scenario. See the Intermediate/Long Term synopsis for more that. If the SPX should trade below 1850.61 and close the week above it, it’s still bullish, just not ideal. Trade below and close the week below 1850.61 sets up a bearish dynamic that will be reevaluated the following week.


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1921.53.

Screen Shot 2016-01-15 at 9.55.38 PMContinued weakness should record 13’s on TD Buy Countdown, currently @9 and TD Combo Buy, currently @11. Even TD Buy Setup, currently @5, can record a 9 This triple confluence should break the downward momentum.

S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1938.68. 

Screen Shot 2016-01-15 at 9.49.15 PMThe daily SPX is officially in TD Buy Countdown, and TD Buy Setup has not been broken. The downside momentum stays intact until TD Buy Setup registers a bullish price flip. Until then, follow the trend to the downside.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Neutral if SPX closes above 2060.99 on Friday, January 22, 2016.

Screen Shot 2016-01-15 at 9.37.04 PMAll is needed this week is one more lower low and that will fulfill most of the requirements for a perfected TD Buy Setup. If the weekly closes this week and the next week above the TDST Support at 1850.61, then a reversal is in line. Following the daily TD Sequential will help support the timing.


S&P 500 (SPX) LONG TERM OUTLOOK: NEUTRAL

Neutral until further notice. 


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Monday, January 11, 2016

Market volatility in China resurfaces again as the People’s Bank of China (PBOC) realized it is no longer beneficial to peg their currency against the US Dollar anymore. Since China governs global growth, volatility in the US can stabilize if China can get a handle on their markets. Following up on Shanghai’s proxy chart, the weekly Market Vectors China A shares ETF (PEK), has sold under the TDST Support at 44.25, and if the downward trend continues, a bottom may occur one to two months out, as the TD counts reach price exhaustion. To further support that notion, the monthly TD count for the iShares MSCI Emerging Markets ETF (EEM) is at TD Buy Setup@8, trading above its TDST Support at 19.86. A TD Buy Setup @9 above 19.86 will be the area where the EEM will process the downtrend and even an all out reversal is a possibility. For the current S&P 500 (SPX), the TDST Support at 2018.94 was breached for good. Next step is to work the daily and weekly SPX charts in conjunction with each other. The daily may hit a price low today or Tuesday. The weekly is showing a price low near the end of January. The most important common factor is proximity of the weekly TDST Support at 1850.61. Screen Shot 2016-01-08 at 10.05.11 PMScreen Shot 2016-01-09 at 11.37.40 PM


S&P 500 (SPX) SHORT TERM OUTLOOK: BEARISH

Neutral if SPX closes above 1943.25.

Screen Shot 2016-01-08 at 9.36.11 PMOne hallmark of weakness is the inability to stabilize at the 8 or 9 count. The current TD Buy Countdown @4 is the major count, and replaces the previously recorded TD Buy Countdown @13 since it was primarily contained inside of the previous TD Buy Setup.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BEARISH

Neutral if SPX closes above 2016.71. 

Screen Shot 2016-01-08 at 9.12.54 PMLooking for a low on either Monday (TD Buy Setup @8) or Tuesday (TD Buy Setup @9). if the quality of the bounce is weak, it will be likely TD Buy Setup transitions to TD Buy Countdown.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH

Go to Neutral if SPX closes above 2005.55 on Friday, January 15, 2016.

Screen Shot 2016-01-08 at 8.42.12 PMBarring a complete meltdown, it looks probable the current TD Buy Setup @6 will finish with a @9. Just need to know if it will record above the 1850.61 TDST Support level.


S&P 500 (SPX) LONG TERM OUTLOOK: NEUTRAL

Neutral until further notice. 


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