Weekend Report

Weekend Report

Provided by the OEW Group

September 7 2019

SPX opened the week lower on Tuesday (post Labor Day Holiday) and made the low of the week at 2892 within the first hour of trading, then proceeded to rally back and finish the day at 2906, down from last weeks close at 2926.  Wednesday had a gap up at the open to retest last weeks close and continued to rally for the rest of the day to reach the highest close since August 8th at 2938.  Thursday saw an even larger gap up to make the high of the week at 2986 within the first hour of trade, then consolidated in a narrow trading range for the rest of the day and finish at 2976.  Friday had a quiet open and continued to stay in that same narrow range for the remainder of the day before closing the week at 2979.

For the week, SPX/DOW gained 1.79%/1.49% while NDX/NAZ gained 2.10%/1.76%.

On the economic front, ISM non-Manufacturing increased and accelerated, while ISM-Manufacturing declined below 50%.  Factory Orders, Unit Labor Costs, Payrolls, Hourly Earnings and Labor Force Participation Rate were all higher, while the rate of job growth slowed.  Unemployment rate held steady at 3.7%.

Investor Confidence declined to the lowest reading since December, just below the bullish line and into the neutral range as we read the data.  The ECRI growth indicator declined and is now extending the previous low further negative.

ecriweekly

LONG TERM: Uptrend may be weakening

spxwkly

In the US, the long-term count remains unchanged with the Super Cycle SC2 low in March 2009.  The Primary wave I high occurred in May 2015 and Primary wave II low in February 2016.  Primary wave III has been underway ever since and the Major wave 1 high of Primary wave III occurred in October 2018.  We continue to track our alternate count on DOW in the public chart list.  No change to our long term count on SPX, as Intermediate wave i of Major wave 3 is underway from the Major wave 2 low in December 2018 and continues to subdivide into Minor and Minute waves.

MEDIUM TERM: Uptrend

spxdaily.png

SPX broke out on Thursday with a large gap over prior resistance established during the August trading range and reached the high of 2986, before settling in to close the week at 2979, which was sufficient to confirm a new uptrend is underway.  We’ve updated the medium term status accordingly, which suggests Minute wave ii bottom has finally been established.  Our cautionary posture proved wrong, as the favorable close mentioned last week turned out to be the correct signal that the downtrend was over.  We have confirmed uptrends now on all four key US markets that we track as well as 5 of 9 US sectors and China too.  However, there are notable laggards including RUT, TRAN, XLE, XLF, as well as some in Asia and Europe.  We would expect most of these to confirm in the near future for our long term view to remain intact.  There was much discussion and some disagreement within the group over various choices for counting the sideways chop in August.  Regardless of the differences, there was strong consensus that Minute wave ii bottom occurred at one of the three lows, 2822, 2826 or 2835 and Minute wave iii is now underway.  For now, we’re tracking that price action as a leading diagonal for Micro wave 1 of Minute wave iii from 2822 to 2940, followed by Micro wave 2 pullback to 2892, with Micro wave 3 in progress to 2986 so far.  This price structure projects our nominal target for Minute wave iii at around 3200.

SHORT TERM

spxhourly

As mentioned last week, the group has come up with several counts to resolve the choppy price action in August, but all of these have various pros and cons relative to our OEW methodology.  Some generate odd patterns and others don’t fit with our short term tracking techniques.  Yet they all suggest the same basic outcome, which is that Micro waves 1 and 2 are complete and Micro wave 3 of Minute wave iii is underway with possibility of some small wave subdivisions developing.  We’ve chosen the one that seems to fit best with our short term tracking techniques and will continue to monitor the other options as the trend evolves.  We counted three corrective rallies off each of the August lows as Nano wave a = 2943, Nano wave c = 2939 and Nano wave e = 2940, which suggests the leading diagonal pattern shown for Micro wave 1.  Then Micro wave 2 = 2892, which is pretty close to fib 38.2% retracement of the entire diagonal pattern.  Micro wave 3 found resistance at our 2984 pivot and has consolidated just below there for the time being.  We’re now watching for impulsive price action to continue.  If it remains corrective, then something else may be in play.  Our initial target for Micro wave 3 is up around 3080.

Short term support is at the 2957 and 2929 pivots.  Resistance is at the 2984 and 2995 pivots.  Short term RSI ended the week neutral after reaching overbought levels at the high.

FOREIGN MARKETS

Asian markets (using AAXJ as a proxy) gained 2.93%.

European markets (using FEZ as a proxy) gained 1.91%.

The DJ World index gained 1.89%, and the NYSE gained 1.54%.

COMMODITIES

Bonds are in an uptrend and lost 0.25%

Crude oil is in a downtrend and gained 2.58%

Gold is in an uptrend and lost 0.91%

GBTC is in a downtrend and gained 9.99%.

The USD is in an uptrend and lost 0.50%.

CHARTS: https://stockcharts.com/public/1269446/tenpp

 

Have a good week!

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416 Responses to Weekend Report

  1. fotis2 says:

    Oil gap up Monday?
    Daily Mail
    Iran-backed militants admit drone swarm strike on world’s largest oil processing plant in Saudi and at second nearby facility sparking huge fires as tensions reach boiling point following tanker attacks

    Liked by 1 person

  2. cj32 says:

    Cr. to CBZ

    Liked by 1 person

  3. fionamargaret says:

    Liked by 2 people

  4. lml25 says:

    If any of you don’t know by now,phil just likes to argue–doesn’t matter about what or with who–and he also wants the last word–whether right or wrong.The news is important–see 1998 and 2008 for gigantic examples.Earnings are news.When Enron was found to be a Ponzi scheme,the stock tanked from $90 a share to nada.Kennedy’s assassination was similar to 9/11 in that there are those in government who would not allow the market to fall for patriotic reasons and national interests.A market crash at those points–on top of the horrific event itself–would have caused severe damage to the country. So PPT buys,institutions buy and we go on.When unknown factors spiral out of control–as with Lehman Brothers,AIG etc,in 2008–does the news matter?Foes it ever.There are cycles too of some sort,manias and other psychological trends,but if the Dems win the White House in 2020–you’ll see how news matters.The Senate too?2100 SPX might be fond memories for quite a while,if that happened.

    Liked by 1 person

  5. As posted from the other day, the $1482 CASH GOLD price is the line in the sand that will denote whether there is a larger correction in progress, as opposed to the several 3.5% – 4.0% minor pullbacks that we have witnessed since the May 2nd low at $1265.80

    Like

  6. Possible double bottom on Gold today, just under $1500.
    See how it resolves on Monday.
    I see a comment posted below “gold is getting cranked on. look out below”
    That’s probably why so many posters here are momentum traders.
    A little weak on the basic TA,doncha think?.
    **
    Interesting vid on why the miners are so weak.
    … nothing left to dig up“.

    Liked by 1 person

    • phil1247 says:

      spike in gc yesterday traded the short
      if it completes …the 1482 extension support will fail
      bottom should fall out at that point

      Liked by 1 person

      • phil1247 says:

        once the extension fails
        start looking down
        long term target is 832

        tony said 20 year bear market in gold
        so dont expect 832 next week 😉

        Liked by 1 person

        • Phil, I Know you don’t trade on news.Fine.
          But $832 Gold? Really? do you ever even read news of any kind?
          Where is your chart to support that?

          Like

          • Actually Tom, it looks like Phil was talking about how NEWS was impacting the market just yesterday… 🙂

            phil1247 says:
            September 12, 2019 at 9:05 am
            look for panic buying in euro and dollar collapse

            now that draghi news is out

            Like

          • Terrific. Yesterday. What happened yesterday,. Not much.
            Where is the news that supports $832 gold?

            Like

          • phil1247 says:

            news never matters tom
            it may give a temporary blip
            but if Kennedys assasination was just a blip
            that could not change the uptrend
            how could any news change the trend ?

            answer …. it cant tom
            nothing can change the trend

            gold is in a bear market for 20 more years
            thats why its headed down
            not because of any news

            Like

          • phil1247 says:

            lets wait to see if the extension fails tom
            lets not get ahead of ourselves
            risk was always to 1482 until 1570 target is hit

            above 1590 …. 832 would be off the table

            Like

          • “News never matters”
            OK, did this market just drop 5% in one day, with no news?
            (Actually market was closed for one week to absorb the news.)
            Was that drop predicted in the charts?

            **
            The problem is, Tony always wanted a classy TA website
            And I am certain his daughter does as well.
            But when people here pontificate about stuff that isn’t so,
            It cheapens the whole thing.
            Please think about it.

            Liked by 2 people

          • phil1247 says:

            tom you make my point

            NOTHING can change the trend
            news cannot change the trend
            the trend was up during Kennedy assasination
            thats why temporary blips from news should be used to BUY
            if the trend is up

            Liked by 1 person

          • phil1247 says:

            RE 9 11 chart

            you make my point again tom

            the trend was already down for over 4 months

            Like

          • lunker1 says:

            Tom so you are speaking for Christine and Tony now? Tony had no problem with Phil and Christine has said multiple times that she doesn’t either. Focus on yourself.

            Liked by 2 people

          • lunker1 says:

            Like

        • torehund says:

          Its possible with 800 gold if the USD rallies accordingly, if you are exposed to miners the ex USA ones would not be bothered.

          Like

          • Yes, Tore, the common wisdom is that Gold and the USD should go in opposite directions.
            But the past year, it hasn’t been the case:
            Gold – up 24%
            USD – up 3.5%

            Some other mechanism at work here?
            Perhaps a global CB debate on the “appropriateness” of the USD as the Reserve Currency, going forward into the final 80% of the 21st Century?

            Liked by 1 person

          • phil1247 says:

            tom maybe you havent been on the blog long enough
            to have read my post from years ago

            ” when the time comes for gold to rally .,, it wont make any difference what the dollar is doing “

            Like

    • lunker1 says:

      Tom,
      Charts with blatantly wrong counted Elliott Waves IS wrong TA. Tony would have kindly pointed it out to you each time so you could learn as people here have also kindly tried to, but you simply bite the hand and then mock their help as if it’s an attack.

      Like

  7. Gary Lewis says:

    I had mentioned on another site that SLV could get a $2 smackdown.

    Sep 4
    As SLV appears to be entering into a bull market phase, interesting to see possible channel ranges. In 2021, I could imagine to see $40 as the midpoint. That could be consistent with a gold/silver ratio moving down to 40. Of course, knowing how silver trades, a $2 smackdown could occur in any moment 😉
    *********
    And how typical. Down $2 from the highs.. But it’s looking like a regular A-B-C correction with prices maybe reaching 15.60 before resuming the rally.

    Liked by 3 people

    • phil1247 says:

      gary
      i think there is one more high coming in silver

      could not post chart
      tonys blog is erratic posting some charts but not others
      i posted pete desarios chart at lunkers for you to see
      he is quite good

      Liked by 1 person

  8. GH, the leader in liquid biopsy cancer testing has been suffering from Softbank’s 30% ownership, given that Softbank was looking to use stakes in GH, Uber, and Slack as collateral for a $4 Billion loan, should We Work raise at least $3 Billion through an IPO.

    Bankers had been setting up an additional $6 Billion credit line contingent on the WeWork IPO valuation. Softbank is looking to buy at least $750 million of WeWork IPO, per the WSJ today.

    Looks like Softbank has been selling off some shares of GH.
    Should be a decent entry point when their done.

    Liked by 1 person

  9. sixpack says:

    Gold is getting cranked on. Look out below.

    Liked by 1 person

Comments are closed.