08/22/2011 Market Outlook (Descending Triangle?)

SHORT-TERM: MORE LIKELY TO CONTINUE LOWER

A Descending Triangle could be in the forming on the SPY intra-day chart, so more likely it will continue lower tomorrow. I’m not very sure because it looks that VIX is about to reverse down, so let’s see tomorrow. On a little bigger picture, I still believe that 08/09 lows will be broken to allow NYMO to form a positive divergence before a real bottom could be possible.

INTERMEDIATE-TERM: SPX DOWNSIDE TARGET  IS 1,000, THE CORRECTION COULD LAST 1 TO 2 MONTHS

See 08/19 Market Outlook for more details.

SEASONALITY: NO UPDATE

Please see 07/29 Market Outlook for day to day August seasonality chart.

ACTIVE BULLISH OUTLOOKS:

• 08/18 Market Outlook: Relief rally could be within 3 trading days.

ACTIVE BEARISH OUTLOOKS:

• N/A

SUMMARY OF SIGNALS FOR MY  PUBLIC CHART LIST: 

TREND MOMENTUM COMMENT Long-term 3 of 3 SELL Intermediate 5 of 5 SELL 3 of 5 NEUTRAL Cobra Impulse in BUY mode; Non-Stop in SELL mode. Short-term DOWN 6 of 6 NEUTRAL

TREND COMMENT QQQ & Weekly DOWN   IWM & Weekly DOWN   SSEC & Weekly DOWN 4.1.4 Shanghai Stock Exchange Composite Index (Weekly): Long term support broken. EEM & Weekly DOWN   XIU & Weekly DOWN   DAX & Weekly DOWN   TLT & Weekly UP   UUP & Weekly DOWN GLD & Weekly UP   USO & Weekly DOWN   XLE & Weekly DOWN 4.4.1 Energy Select Sector SPDR (XLE Weekly): BPENER oversold. XLF & Weekly DOWN 4.4.2 Financials Select Sector SPDR (XLF Weekly): Long term support broken. IYR & Weekly DOWN   XLB & Weekly DOWN *4.4.4 Materials Select Sector SPDR (XLB Weekly): BPMATE oversold.

* = New update; Blue Text = Link to a chart in my public chart list. UP = Intermediate-term uptrend. Set when weekly buy signal is triggered. DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.