FOR MONDAY: (8/25) Nothing dramatic at Jackson Hole except a continued drubbing for the dollar that should continue into Labor Day. Stocks may take a break next week and be sideways to lower. Gold and silver look higher for another week and oil is in trouble next week. Mondays have been doggy in the summer and overdone conditions from Friday may balance out or will the trade be struck by the horror of Hurricane Harvey? Send prayers and donations to those in need going into the weekend.
SEPT. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR MONDAY: (8/25) Market barely gave a breakout and then closed near key support and NQ closed under the key 5817 region. While stocks might recovery on Sunday, they seem lower early Monday and then often rally when no one is home on Mondays. Will easily get to 2430 next week and we’re open to 2405 even by Labor Day. Not sure the hurricane will be good for the economy and that may set a messy tone the week. Not thinking that 2455 or 2459 will come out.
If we really want a serious buy, we need to wait for 2405, which is possible if Yellen says the wrong thing.
Given past history, the bears can make a case that the rally was pretty terrible and only 3 waves and it could be a congestive 4th wave. That leaves us looking for a more solid breakdown below 2430 to turn bearish. NQ’s close below 5825 was not a good sign.
Cash left a gap at 2430 and but also one above at 2460.
OVERALL: We’re tempering our bullish interpretation until we see 2400-2405 hold into Labor Day. Since the market didn’t breakout on Friday, major resistance is up to 2459-60 is resistance We’re open to 2520 into September.
WEEKLY CHART: There’s still a good possibility that based on patterns that the current fall is a 4th wave and that a new high to 2500-2520 would be possible in September but a secondary high to 2477 is more likely. In the end we still will have a minimum fall to 2360 or max. 2300-2320 as a fall correction target with a multi-year high due into 2018. Market needs to hold 2400 into Labor Day and shoot out of there to open up that scenario.
CYCLES OVERVIEW: Topping Sunday/Monday; lower into Wednesday; recovering Thursday/Friday.
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