06/07/2015 – Market Update
Weakness in Both Stocks and Bonds
Table of Contents
- Broad Market in Short-Term Bearish Time-Window
- Sector Performance Ranking with Wireless Communication Sector Leading
- S&P 500 Index in Primary Impulse Wave 5
- German DAX Index: Elliott Wave
- India Bombay Stock Exchange Index in Bump-and-Run Reversal Top Pattern
- Shanghai Composite Index: Intermediate-Term Picture
- Major Global Markets Performance Ranking
- US Dollar in in Bump-and-Run Reversal Top Pattern
- US Treasury Bond Bearish Breakdown 9-Month Ascending Broadening Wedge
- Gold Bearish Breakdown 3-Month Ascending Triangle
- Silver Forming 3-Month Uptrend Channel Pattern
- Crude Oil Forming Measured Move Up Pattern
- Asset Class Performance Ranking with US Dollar Leading
Broad Market in Short-Term Bearish Time-Window
The daily chart below has the Wilshire 5000 index with both the BIX and the Momentum indicators. The current market status is summarized as follows:
Sector Performance Ranking with Wireless Communication Sector Leading
The following table is the percentage change of sectors and major market indexes against the 89-day exponential moving average (EMA89). The Wilshire 5000 index, as an average or a benchmark of the total market, is 0.46% above the EMA89. Outperforming sectors are Wireless Communication (5.36%), Banks (4.97%), and Biotech (3.32%). Underperforming sectors are Precious Metals (-6.56%), Utilities (-4.85%), and Real Estate (-4.79%).
S&P 500 Index in Primary Impulse Wave 5
Primary wave [5] has been confined in a rising wedge for over 6 months. This rising wedge is also characterized as a Ending Diagonal. Since the beginning of March, it has been in corrective intermediate wave (4) with a flat correction combining two a-b-c corrective wave sequences. Now it is in sub-wave c of the second a–b–c corrective wave process. Currently prices are testing the lower boundary of the rising wedge. If the lower boundary is breached, 2060 could be a support for wave c to end. Intermediate wave (5) will be the next.
For more information about the ending diagonal, visit: “Ending Diagonal: A Pattern That Sends Shivers Down Investors’ Spines” at Elliott Wave International.
German DAX Index: Elliott Wave
India Bombay Stock Exchange Index in Bump-and-Run Reversal Top Pattern
Shanghai Composite Index: Intermediate-Term Picture
Since the beginning of this year, the index has been in intermediate wave (5). Now this intermediate wave becomes a fifth-wave extension within a rising wedge or an ending diagonal. Intermediate wave (5) is the last up leg of primary wave [1]. Corrective primary wave [2], potentially a crash more than 20% is the next.
A fifth wave extension or an ending diagonal implies dramatic reversal ahead. For more information about the ending diagonal, visit: “Ending Diagonal: A Pattern That Sends Shivers Down Investors’ Spines” at Elliott Wave International.
Major Global Market Performance Ranking
US Dollar in Bump-and-Run Reversal Top Pattern
US Treasury Bearish Breakdown 9-Month Ascending Broadening Wedge
Gold Bearish Breakdown from 3-Month Ascending Triangle
Silver Forming 3-Month Uptrend Channel Pattern
Crude Oil Forming Measured Move Up Pattern
Asset Class Performance Ranking with US Dollar Leading
The following table is the percentage change of each asset class (in ETFs) against the 89-day exponential moving average (EMA89). Currently the US dollar is outperforming and the US treasury bond is underperforming.