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