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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