FOR WEDNESDAY: (3/15) No change from this morning. Everything centers around Wednesday with the Dutch election, the FOMC rate hike (no biggie), the debt ceiling expiration and five other reports. Should be interesting. For now we can get positioned in the direction we expect things to go but these markets are always full of surprises. Keeps life interesting.
JUNE E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S&P ANALYSIS FOR WEDNESDAY: (3/15) S&P held key lower support at 2355 and the market looked liked it finished 3 waves down with 3 waves up now possibly going to 2379.50. If 2350 fails, then we can be more aggressive on the short side. For now we have to treat it all as congestion. One larger cycle is weaker into Friday but most of the other cycles are friendly so we have to watch patterns and breakdown areas carefully.
OVERALL: While daily stochastics have issue a sell signal, it is possible that all we saw last week was a 4th-wave low and two more highs are needed. The time window for this is short as past March 20 we think the market is more vulnerable. This week’s low was enough to satisfy that it was a minor 4th-wave pullback and that new highs can come into next week but not a definite. If the market had fallen a bit more in 5 waves we could sell a 3-wave bounce to 2381 and feel clear on where the market is but that isn’t the case. The debt ceiling crisis starting March 15 may be a coming negative. We had thought a secondary high next week so if there is a sharp fall it may start the week of
BIG PICTURE: If the market doesn’t take off this week into March 17– and we’re skeptical — then we do favor 2321 on cash and have to be short in case more manifests. Seasonally the market is often lower the 2nd half of March. The 2520 projection for May is very clearly in the patterns now and wondering if it will happen. We see no point in top-picking.
LONGER TERM: (2/15) Still thinking an early April low and then still new highs this year and not thinking crash this year to 2520 and maybe a 10% correction between August-October and 20% If things seem more dire with US rioting and a deeper European collapse. Market seems lower from mid-May into late June and probably into July.
CYCLES OVERVIEW: Volatile Wednesday but eventually higher; higher Thursday.
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