Latest Market Update

Stock Market Waiting for a Breakout to New Highs

Sunday, May 17, 2015

The S&P 500 index nears the end of its 10-week flat correction confined in an ascending triangle pattern. Once prices break above the upper boundary of the ascending triangle, the upside price target is projected at 2180. Gold and silver had a bullish breakout from their 3-month inverted head-and-shoulders pattern and confirmed a short-term bullish reversal. Currently the precious metals sector is leading the market. The broad stock market is projected to be in a short-term bullish time-window until 5/26/2015.

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Market Topping Process

Sunday, May 10, 2015

The S&P 500 index has been in a 2-month flat correction and it is waiting for a breakout from its 10-week ascending triangle pattern. The Chinese stock market turned into a major correction with the primary second wave, and the Indian stock market rolled over after a major bearish reversal. The German DAX index has been in a correction with the intermediate fourth wave. The broad stock market is projected to be in a short-term bearish time-window until 5/12/2015.

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Bearish Signs in Financial Markets

Sunday, May 3, 2015

A bearish sign appears as the S&P 500 index nears the end of its 6-year rising wedge. The U.S. dollar has formed a bump-and-run reversal top, and the 30-Year U.S. Treasury Bond also has a bearish sign with a partial rising inside a 9-month ascending broadening wedge. The Indian stock market has formed a major bearish reversal, and the German DAX index has been in an intermediate correction. Readings of the Broad Market Instability index are rising. The broad stock market is projected to be in a short-term bearish time-window until 5/14/2015.

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Stock Market Cautious

Sunday, April 26, 2015

The U.S. stock market is neutral, and the S&P 500 index is waiting for a breakout from an 8-week ascending triangle pattern. The German DAX index gets into a correction, and the Indian Bombay index has a bearish reversal while the Chinese Shanghai index is in the last up leg before a major correction. The broad stock market is projected to be in a short-term neutral time-window until 4/30/2015.

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Choppy Market Continues

Saturday, April 18, 2015

The S&P 500 index was unable to break above 2100, and it returned into a 7-week symmetrical triangle pattern to continue a choppy mode. Crude oil had a bullish breakout from a 3-month double bottoms pattern. The broad stock market is projected to be in a short-term neutral time-window until 5/4/2015.

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Market Nears a Breakout

Sunday, April 12, 2015

The S&P 500 index nears the end of a choppy mode which is confined in a 6-week symmetrical triangle pattern. Once it breaks above 2100, the S&P 500 index could make a new high at 2173. Gold and crude oil also near their bullish breakout levels. The broad stock market is projected to be in a short-term bullish time-window until 4/20/2015.

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Weakening Market

Sunday, April 5, 2015

The U.S. stock market weakened after recent disappointing economic data. The mixed signals from our indicators point to a choppy market. The support level of 2040 will be critical for the S&P 500 index, because a breach of 2040 could change the market to a more conservative scenario. The broad stock market is projected to be in a short-term bearish time-window until 4/17/2015.

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Choppy Market

Sunday, March 29, 2015

The U.S. stock market lost momentum when major overseas market indexes like the German DAX, India Bombay index, and Shanghai index got in stalling with topping patterns. The market becomes choppy as it approaches the end of the first quarter and a short week with reporting several important economic data. The broad stock market is projected to be in a short-term bullish time-window until 4/2/2015.

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Stocks Resumed Uptrend

Sunday, March 22, 2015

The U.S. stock market finished the short-term pullback and resumed uptrend last week. The S&P 500 index has started the third upward minor wave which overlaps the third upward intermediate wave for forming a potentially strong U.S. stock market. We would be more cautious about overseas markets now because the German DAX, India Bombay index, and Shanghai index are in topping patterns in the intermediate-term time frame. The broad stock market is projected to be in a short-term bullish time-window until 4/2/2015.

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Watch: Triple Witching and FOMC Meeting

Sunday, March 15, 2015

As the U.S. dollar hits 12-year high and oil slumps to 6-year low, the pullback of the S&P 500 index has retraced to the 60% level of the previous upward minor wave. Our Broad Market Instability Index is above the panic threshold, and the stock market still needs few days of consolidation. The market could be volatile in the coming week with the triple witching and a FOMC meeting. The broad stock market is projected to be in a short-term bearish time-window until 3/19/2015.

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Stock Market in Short-Term Correction

Sunday, March 8, 2015

The stock market fell after strong US jobs data sparked Fed rate hike expectations. The S&P 500 index is developing the second minor wave which is a short-term corrective wave. The 30-year U.S. treasury bond and gold are also falling while the U.S. dollar resumes its uptrend. Our Broad Market Instability Index moved above the panic threshold. The broad stock market is projected to be in a short-term bearish time-window until 3/19/2015.

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Stock Market in Consolidation

Sunday, March 1, 2015

The S&P 500 index has been topping, and it just got into the second minor wave which is a short-term corrective wave. The 30-year U.S. treasury bond and gold could rebound from their recent lows. The broad stock market is projected to be in a short-term bearish time-window until 3/13/2015.

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Weak Bonds and Strong Stocks

Sunday, February 22, 2015

The S&P 500 index made a record high, and it is in the early stage of the intermediate third wave which has a minor five sub-wave sequence. Currently it is near the end of the first minor wave inside the intermediate third wave. The 30-year U.S. treasury bond is still falling from its 1-year Bump-and-Run Reversal Top. The broad stock is projected to be in a short-term neutral time-window until 3/2/2015.

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Stock Market Challenges All-Time High

Sunday, February 15, 2015

After the bullish reversal on crude oil, the 30-year U.S. treasury bond is falling from its 1-year Bump-and-Run Reversal Top. The S&P 500 terminated its two-month-long flat correction, and started the intermediate impulse third wave to the upside. The broad stock market is breaking from the previous high, and it is projected to be in a short-term bullish time-window until 2/19/2015.

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Reversals: Bullish Oil and Bearish Bond

Sunday, February 8, 2015

Last week crude oil had a bullish reversal from it 6-month Bump and Run Reversal Bottom while the 30-year U.S. treasury bond had a bearish reversal from an 1-year Bump and Run Reversal Top. The German DAX index is in an advance of the third intermediate wave, and the S&P 500 index is still in a flat correction with the second intermediate wave. The broad stock market is projected to be in a short-term neutral time-window until 2/12/2015.

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Bad Omen for General Stock Market

Sunday, February 1, 2015

Four bearish indications from 1) Santa Claus rally failure, 2) the first five days of the year indicator, 3) the January barometer, and 4) Super Bowl Indicator seem an omen of a bear market for stocks to come in 2015. The broad stock market is projected to be in a short-term neutral time-window until 2/5/2015.

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Stocks in Short-Term Bullish Time-Window

Sunday, January 25, 2015

The German DAX index last week broke above its 1-year broadening wedge patter. This breakout is a very bull sign for the intermediate third wave of the DAX. The U.S. stock market resumed its upward move also in the intermediate third wave. The broad stock market is projected to be in a short-term bullish time-window until 2/6/2015.

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Gold and Precious Metal Stocks Strengthening

Sunday, January 18, 2015

Gold and precious metal stocks had bullish breakouts and are in bullish patterns, gold above 6-month descending broadening wedge and precious metal stocks above 2-month rectangle bottom. The stock market is near the end of the pullback but still volatile. The broad stock market is projected to be in a short-term bullish time-window until 2/6/2015.

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Bullish Signs in Gold and Bearish Sings in Stocks

Sunday, January 11, 2015

It is a bullish reversal sign that gold is breaking above its 6-month descending broadening wedge and precious metal stocks are breaking above their 2-month rectangle bottom (or double bottoms) pattern. The stock market is weakening as Santa Claus rally failed to show up within the last five days of last year and first two in this January. Also a poor performance of the S&P 500 index in the first five days of January seems to be sending a warning signal for a weak market in 2015. With volatility expected to rise, the stock market this year will be more erratic than last year. The broad stock market is projected to be in a short-term bearish time-window until 1/20/2015.

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Be Prepared for Higher Volatility in 2015

Sunday, January 4, 2015

The 30-year U.S. treasury bond and the U.S. dollar have been strong and extended gains. It is a bearish sign that the stock market so far has not seen a Santa Claus rally supposed to be within the last five days of December and first two in January. Then the first five days of January become important to further check the strength of the market. With volatility expected to rise, the stock market this year will be more erratic than last year. The broad stock market is projected to be in a short-term bullish time-window until 1/6/2015.

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USB, SPX & USD Had an Excellent Year in 2014

Sunday, December 28, 2014

The broad stock market, the U.S. treasury bonds and the U.S. dollar all extended market gains for the week. Year to date, as of last Friday, the 30-year U.S. treasury bond (USB) is up 18.09%, the S&P 500 index (SPX) 13.01% and the U.S. dollar (USD) 12.49%. The S&P 500 index is in the early stage of the third wave of a new intermediate five-wave sequence. The third wave is usually the largest and most powerful wave in a trend with fast-rising prices and short-lived corrections. The broad stock market anticipates a Santa Claus rally, and is projected to stay in a short-term bullish time-window until 1/6/2015.

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Setting Up a Santa Claus Rally

Sunday, December 21, 2014

The S&P 500 index ended its downward intermediate wave 2 as the Fed’s pledge to remain “patient” stayed in focus. The sharp rebound since last Wednesday has started the intermediate third wave and it potentially can reach to 2225 for the S&P 500 index. The Broad Market Instability index went below the panic threshold and the momentum turned to positive. The broad stock market is projected to stay in a short-term bullish time-window until 1/6/2015. This bullish time-window most likely will let the market have a Santa Claus rally within the last five days of the year and first two in January. The U.S. dollar edged up adding to multiyear highs, and it still has an upside potential. Crude oil hovers near multi-year low, and it should have a rebound soon.

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Stock Market Intermediate Correction Underway

Sunday, December 14, 2014

Last week the stock market went into an intermediate level correction after the warning signal from unusual high readings of the High Low Logic Index in the New York Stock Exchange. The Broad Market Instability index continued surging above the panic threshold. The S&P 500 index and the German DAX have begun the second intermediate wave which is a corrective wave for a retracement. The Shanghai Stock Exchange Composite index is ending its powerful third intermediate wave after it reached 3091 which is slightly below our third upside price target 3150. The broad stock market is projected to stay in a short-term bearish time-window until 12/23/2014.

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Unusual and Inconsistent Market Internals

Sunday, December 7, 2014

As a new Chinese bull market woke up, the Shanghai Stock Exchange Composite Index advanced explosively and reached our second upside price target 2850. Now a new chart pattern analysis projects another upside price target at 3150 for the Shanghai index. The U.S. stock market continues positive drifting near its all time high while the Broad Market Instability Index stays above the panic threshold. Increasing numbers of new 52-week highs and lows in the New York Stock Exchange present a strong divergence and indicate inconsistency of market internals. Current unusual high readings of the High Low Logic Index flash a warning signal that it is time to be cautious about the U.S. stock market.

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Bullish Stock Market but Not All Sectors

Sunday, November 30, 2014

The stock market, U.S. dollar, and 30-year U.S. treasury bond all are bullish, and their prices hover near their 52-week highs. However our weekly updated sector performances show a strong divergence of stock sectors, as semiconductors, home construction, and biotech sectors are near 52-weeks highs while precious metals, oil equipment, and energy sectors are close to 52-weeks lows. Especially the momentum of the general stock market is still weakening but the volatility has a sign to jump up. In overseas markets, last week the Shanghai Stock Exchange Composite index had a powerful bullish breakout from a 3-year rectangle bottom pattern, and confirmed the change of its long-term trend from a bear market to a bull market.

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What Does Primary Fifth Wave Mean to S&P 500?

Sunday, November 23, 2014

The powerful rebound since mid October has pushed the S&P 500 index into the primary fifth wave which is the final upward leg of the multi-year-long bull market started from 2009. This primary fifth wave sets potentially another major upward move for the stock market from the October low in 2014 to the pre-election year high in 2015. Still, there will be a possible consolidation on the S&P 500 index as the momentum is weakening. The broad stock market is projected to stay in a short-term neutral time-window until 11/28/2014. A bullish breakout from a multimonth descending broadening wedge pattern is emerging on gold, silver, and their mining stocks although their trend is bearish.

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Stock Market is Losing Momentum

Sunday, November 16, 2014

The stock market stays at record highs but momentum is decreasing. There will be a potential pullback on the S&P 500 index, suggested by Elliott wave analysis on the next projected downward wave. The broad stock market is projected to stay in a short-term neutral time-window until 11/28/2014. Gold, silver, and their mining stocks are all forming a multimonth descending broadening wedge pattern which is potentially a bullish reversal pattern although their trend is bearish.

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Possible Consolidation for Overbought Stock Market

Sunday, November 9, 2014

The broad stock market has been in a sharp rebound for over three weeks. The S&P 500 index made another new all-time high as the U.S. dollar reached a four-year high and the 30-year U.S. treasury bond extended its 10-month bullish uptrend. Elliott wave analysis suggests a pullback in the S&P 500 index ahead, with a downward wave counted as either the intermediate C wave or the intermediate second wave. The broad stock market is about to turn from bullish to neutral, and is projected to stay in a short-term neutral time-window until 11/28/2014. There is a potential bullish reversal for gold, silver, and their mining stocks as some of them hit and bounced off downside technical levels.

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SPX Hit a New Record Ahead of Midterm Elections

Sunday, November 2, 2014

The broad stock market continued its sharp rebound after a recent correction. The S&P 500 index (SPX) fast hit a new record high. The bullish tone should extend to the next week, and the broad stock market is projected to stay in a short-term bullish time-window until 11/4/2014 which coincides with the U.S. general election day. Although the stock market may extend the rally further, a pullback could occur after the election, with a downward wave counted as either the intermediate C wave in the complex-correction scenario or the intermediate second wave in the expanded-flat-correction scenario. Following the falling Japanese yen in a surprise stimulus move from the Bank of Japan, gold, silver and their mining stocks all are bearish below their descending triangle patterns.

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A Bullish Tone in Stocks

Sunday, October 26, 2014

The stock market had a big rebound and set a bullish tone as U.S. general election day approaches. Biotech, Healthcare, and Home Construction sectors led the rally. The Broad Market Instability index (BIX) has returned into a low volatility territory. The correction may near the end when the primary corrective fourth wave of the S&P 500 index reaches its late part. The broad stock market is projected to stay in a short-term bullish time-window until 11/4/2014 which is coincident with the U.S. general election day. In the German DAX index, the one-year head-and-shoulders top pattern has completed and it could become a precursor of a potential “Three Peaks and a Domed House” pattern. Crude oil is in a Bump-and-Run Reversal Bottom pattern and is due for a rebound.

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