Monday, March 31, 2014

ImageImageLack of diplomacy from the Russian troop build-up along the Ukraine border – Buy Russian stocks. Crackdown on YouTube and Twitter in Turkey – Buy Turkish stocks. When markets contradict what conventional thinking would suggest, investors are seeking cheap valuations. These ideas are supported by the daily and weekly TD Buy Setups on the iShares Turkey ETF (TUR), which turned a bullish price flip, and the Market Vectors Russia ETF (RSX), which is on the verge of a price flip and regaining previous support at 23.25. If these moves provide more than just a bounce off oversold levels, the whole emerging market landscape will turn bullish under the guise that a China slowdown and rising interest rates will stay under control. 

It’s a nice start to the end of the quarter for the S&P 500 ahead of Janet Yellen’s speech. It’s becoming a bullish event whenever she’s at the podium. The 1840 – 1883 area is still considered noise. 

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

Bearish once SPX closes under 1842.81 (updated March 28th). 

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

Bearish if SPX closes below 1842.81, the bearish trigger for the Short Term Outlook. 

ImageThe SPX closed high enough last Friday to revert back to a neutral stance. The tight range is well defined as shown on the TTM_Squeeze indicator. To get a better view of the indicator, the Bollinger bands are flattening, and it will pinch closer if the SPX begins to triangulate. 

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

Switch back to neutral if SPX closes above 1878.04. That will also record a TD Sell Countdown@13. 

ImageImageImageImageWhile the shorter duration SPX charts have been lacking in consistency, the weekly chart quietly slipped to a bearish price flip. The Nasdaq and the Russell 2000 both exhibit quality bearish candles, while the Dow is still engaged in an active TD Sell Setup. While the range-bound trading that has started since the beginning of the year is still ongoing, there is a pretty good chance the sluggish trading may morph into the weekly and monthly charts as a correction in time. 

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

Flip to neutral if SPX closes below 1805.81 on the last day of March (updated March 3rd). 

 

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