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. sixpack says:

    Here’s a question for Asaranti or Phil,….why does the DH method suggest that a .618 retracement is a failure? I always thought that a .618 retracement was a rather normal and healthy elliot wave correction level. Thx

    Like

  2. phil1247 says:

    asa
    long EXAS from 106
    extension targets 113

    Like

  3. gary leibowitz says:

    And I thought we were warned about in fighting? I guess Phil didn’t get the message nor does this rule apply to him. The frustration is many on how illogical and non-Elliot this market is behaving. The market is in a holding pattern for a very long time.

    BUT there is a pattern at these tops. We hold for many days and then have a quick 2 day swoon. The minimum i see this current move dropping is 2880 on SPX.

    I see no ability to rally from here to the next level up. Time wise we are due to see that 2 day swoon. I still suspect we drop further and harder but that remains to be seen.

    Liked by 2 people

    • torehund says:

      Small caps runs 🙂

      Liked by 1 person

      • gary leibowitz says:

        Yes I noticed this possibility a week ago. the candlestick were strong on short term play while all the other indices were not. As for this being a terminal move I am pushing for that outcome BUT it is now above the resistance level and is forming a new leg up. 3020 plus seems logical. It also means a more violent deeper drop should occur afterwards. Just my interpretation of finding new highs here.

        Like

  4. Mary773 says:

    RUT and AAPL on course, and many semis on the verge of weekly breakouts which if achieved would mean quick catch-up for NQ:

    RECESSION RECESSION RECESSION…

    Like

  5. M Wags says:

    CBZ with yet another Flip Flop.

    From Full Bear late last week, citing non-impulsive corrective waves and overlap….to full Bull again. The week before that he was citing a bearish cluster of three 1-2’s on Aug.27th, only to turn Bullish on Aug. 28th.

    I’m sorry.
    I just cant keep up anymore.

    Liked by 1 person

  6. cj32 says:

    Cr. to CBZ

    Like

  7. sixpack says:

    Phil and Wags, wish you two self proclaimed brilliant minds would teach us something to make money rather than argue about whos the best trader. Nobody cares if you have $50k in your acct or $5m. It just doesnt matter. Lots of different folks on this blog trying to learn about or get an edge.

    Like

    • Tom Smith says:

      You make it sound like $50K is a derisory figure, when in fact American households have median savings of under $5,000. Most wouldn’t know what a trading account is.

      Everyone here is in the highly fortunate minority – even if they’ve got only $10K to play with.

      Liked by 1 person

    • M Wags says:

      On numerous occasions, Ive tried to share a methodology that has made me a ton of money. But because it involves fundamental research, I get trolled for it.

      Its also difficult to post from an extensive knowledge base that spans over 35 years as a professional, from 10 years as a floor trader scalping the 20 second trend to that of a global futures trader for a $2 Billion asset-allocator, and then eventually transitioning to an equity investor and swing trader ….when there are people here who cant even agree that news impacts stocks and the markets.

      Its like me saying that the sky is blue, but getting trolled for it by two 70 year old guys who dont trade stocks and dont even have an ES account open.

      I’ve always enjoyed sharing what works, and what doesnt work with younger people. But on blogs like this, I rarely see anyone seeking to LEARN.

      They only come to blogs to either constantly pat themselves on the back like I see Phil do, troll like the Bobo’s of the world do, or… they simply want to find others who share their same bias.

      Quite honestly, the knowledge base here is fairly weak, and I cant help but feel an overwhelming feeling by many here that the markets are manipulated by the PPT and that the Goldman’s of the world are making a ton of money trading their own account, never mind that the Volcker Rule in 2014 made proprietary trading illegal. In fact, I dont even know how some of the people get out of bed in the morning and trade….knowing how embedded the PPT is in their thinking. The paranoia is palpable in the blogospere, and this blog is no exception.

      Ive never found stock market blogs like this to add much, if any value. In fact, I find them to be more of a distraction and waste of time given the lack of a decent knowledge base on how the markets work. I keep thinking that there will be an Elliott Wave “nugget” that I stumble across, but it just hasnt happened.

      I remember asking on two occasions what trading platforms do people here use for trading stocjs and futures. Only one person replied. I must say, I found that rather telling.

      Tomorrow is 9/11 and I honor that day by taking the day off and focusing on friends and family. I had friends that died on that horrible day trapped on the top floors at Cantor, Fitzgerald, not too mention a good friend of mine that was a flight attendant.

      I dont know how much longer I will be posting here in an active manner, especially given how many here cant even agree that news impacts the markets or how the Phil’s of the world think that the Fed is “irrelevant”.

      Like I said, this blog is dominated by people who have no interest in LEARNING.

      Take care.

      Liked by 1 person

      • I absolutely agree with you 100%.
        The big money is made while riding the trade, and a fundamental analysis with a technical analysis (To pinpoint entries) is absolutely fundamental.

        I enjoy the blog, especially the weekend summary. Its a small part of many other research I use. But in the end everyone has to do their own due diligence.

        the bickering needs to stop.

        Liked by 3 people

      • phil1247 says:

        feel free to leave any time
        Money Maker ..Bluehorseshow, Wags and any other aliases you use

        i only ask you the same question i asked A. H. michael

        why is a so called big shot person like yourself
        1……posting his account balance on this blog ( tacky and low class)
        2….. attacking women and others
        3 .. why are you even here AT ALL…
        if this is what you believe

        Ive never found stock market blogs like this to add much, if any value. In fact, I find them to be more of a distraction and waste of time given the lack of a decent knowledge base on how the markets work. I keep thinking that there will be an Elliott Wave “nugget” that I stumble across, but it just hasnt happened.

        Liked by 2 people

        • sixpack says:

          Phil, why dont ya just leave him alone. If he wants to post his statement who cares. Blue adds good info at times Like his ad line post last week. That was good stuff. You’ve harassed plenty of others yourself….iamnotvil. leave each other alone and just focus on the markets and trading and adding some value to the blog.

          Liked by 1 person

        • fionamargaret says:

          It is not your blog to suggest who leaves and stays.
          Everyone is welcome.

          Liked by 1 person

  8. torehund says:

    Crude oil is acting like a Rattle snake up here, not much rattling but a lot of shaking 🙂 Chart looks good, out goes the weak hands 🙂

    Like

  9. M Wags says:

    For those that didnt know what “news” hit shares of EXAS yesterday . . .

    https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0220234#pone-0220234-t002

    Like

Comments are closed.