Monday, June 29, 2009

Weekly Stock Charts review from Stockcharts.com Publishers

Will the markets break? Another week where early week weakness was reversed. What had the stockchart.com ers to say about it all?

Anthony Caldaro of the Elliott Wave lives on has labelled a '1' / '2' of a new 5-wave down. '2' for the S&P is just over 930. It's an alternate count to his original ABC correction (which is still labelled) but it's worth keeping track of.


Richard Lehman has gone with new short term upchannels - but sees the broader downtrend taking control over the next few days.

6/27 -- Laggards like financials (XLF) and China shares(FXI)have now finally broken into new upward blue mini channels, joining the others. The small caps have had the greater pop upward, but all the indexes are showing this pop to be narrow and somewhat steep, suggesting a brief life. I am still expecting that they will peak out with a few days at levels below the highs of June 11th, forming peaks that will determine the angle of the larger descending channels here.

6/25 -- The broader indexes all broke clearly upward through the purple downtrends today. With that, we are in new blue upward minis and I now see the bigger picture developing. In my view, the purple downchannels were really just minis, as I suggested early on. That means the purples formed the first leg down of a larger downchannel and the current upmove is leg #2 up. This new upleg is narrow and will not likely last more than another few days or so. I've drawn this larger downward scenario on the DJIA and Nasdaq hourly charts.

This scenario would work well with expected end of quarter window dressing and is supported by the substantial drop in VIX today. A continuation of the downtrend beginning near month end would be supported by the even larger premium now in VIX futures for July.

6/24 -- The bounces continued, at least up until the Fed announcement, at which time a 'sell on the news' party ensued. Some indexes reached the upper lines and some only got close, but the result was that everything held trend in the purple channels. VIX declined, even with the sell-off, so maybe that is a sign that a more lasting turn upward is close at hand.

Joe Reed has his weekly summary:


Didn't notice this comment of his tucked under Joe's own EWT count

6-18-09 Update: But don't get carried away with one chart. Here's a 2nd Elliot wave opinion.Another famous 'Elliot Waver', Neely, says the March-June rally is in the final leg of the correction and now ending. The Bear Market will resume sending the S&P DOWN FIFTY-PERCENT in the next 6 mos to well below 500, Yipes! We shall see, huh? In the meantime, just be careful out there.


Hurricane Season has begun.


Solid dollar chart here:


Significant bearish divergence in the Ultimate Oscillator of the SPY:


Yong Pan of Cobrasmarketview shows neutral short term conditions with bearish intermediate conditions.


Rally on fumes? Note lack of either distribution or accumulation days.


I like the idea for a complex head-and-shoulder pattern - this would translate into a boring summer and potentially torrid September on:


Gaps to fill:


Finally, Ted Burge of Tedlines.com has a point-n-figure chart showing a bearish target of 7,700:


Grim viewing all round but contrarians will see this as good news (the same good news which has kept this rally going since it started in March and ran into its first resistance level in April).

Enter to win the Trader's Business Plan prize of a free psych test and free access to the trading plan development program. Retail value $398

[1] Register at Zignals.
[2] Go to Charts and select a stock (you will be prompted to download Microsoft Silverlight)
[3] Click on the YourCall Icon


[4] Enter a Call by giving a stop and target price; make sure the Time Period is set to Short (month)
[5] Enter as many calls as you like up until the end of June; these can be long or short signals
[6] Send me your Zignals Userid so I can track the calls made (declan-at-zignals.com) or post it in the comments section of this post. In your email make reference to the competition.
[7] The Zignals member with the stock giving the highest return from either a target hit or expiration after 22 trading days will win the prize. Only stocks or FX prices listed on Zignals qualify for entry (no pink sheet stocks). The announcement of the prize winner will be made at the end of July.

Good luck!


Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

 
f9229fcfd1b1390be00cfccc86c90349c93a4179bf4227457c