SHORT-TERM: A LITTLE BEARISH BIASED
Will temporary maintain bearish bias toward the next week because as mentioned in 05/20 Trading Signals, there’re chances that a Head and Shoulders Bottom could be in the forming, so if Monday gap up huge (like usual, didn’t we see this lots of times?) and goes sharply higher, it’d be enough to change my already-not-so-determined-bear-mind.
Why bearish biased toward the next week?
- As mentioned in 05/06 Market Outlook, IWM Weekly Bearish Engulfing means bearish for the next 3 weeks. The next week is the 3rd week, so over 90% chances SPX at least will close below its 05/06 close at 1340. (SPX now is at 1333)
- The week after a red OE week (that’s next week) was more likely red or at least have a lower low (in the SPX language means SPX will have a low that is lower than 1318).
- Week before Memorial day was a little bearish biased according to Schaeffer.
- 3.1.2 PowerShares DB US Dollar Index Bullish Fund (UUP 60 min), the dollar may resume up the next week. This should put pressure on the stock market.
I know some may say that SPX has been down 3 weeks in a row, so the chances for yet another red week should be much lower. Well, at least I don’t see so in the back test bellow. However if you buy at Friday’s close and hold until the very first green week, you’d have 71% chances, just in most cases turn off your computer may not be a very bad idea…
INTERMEDIATE-TERM: SPX NOW IN 1352 TO 1381 WAVE 5 PRICE TARGET AREA, WATCH FOR POTENTIAL REVERSAL
Maintain what I said in 05/06 Market Outlook. Need pay attention to the possibility that wave 5 ends while primary wave 3 sharply down has started. Still just an attention, not even a warning though.
SEASONALITY: NO UPDATE
For May seasonality day by day please refer 04/29 Market Outlook.
ACTIVE BULLISH SIGNALS:
- 0.2.1 10Y T-Bill Yield: ROC(30) < –9, so bottomed?
- 0.1.1 SPX Intermediate-term Trading Signals: CPCE MA(5) too low, so a bottom is close.
ACTIVE BEARISH SIGNALS:
- 4.0.1 SPX Long-term Trading Signals: Weekly EMA(13) is too far above EMA(34).
- 4.0.7a Collection of Leading Indicators I: Negative divergences become too much and too big.
- 8.1.1 Normalized NATV/NYTV: Too high, so topped?
ACTIVE BULLISH OUTLOOKS:
- 09/27 Market Recap: 9 POMO within 20 trading days means 14%+ up in 3 months.
- 03/11 Market Recap: Bullish in 3 to 6 months.
- 04/21 Market Recap: QQQ weekly Bullish Engulfing is bullish for the next 6 weeks.
ACTIVE BEARISH OUTLOOKS:
- 04/21 Market Recap: SPX will close below 04/20 close soon.
05/06 Market Outlook: Bearish in 2 weeks.
HIGHLIGHTS OF THE OTHER ETFS IN MY PUBLIC CHART LIST:
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