donderdag 6 juli 2017

Thursday Market Observations

# We hit our SPX 2450 target on 6/19 and then started a consolidation that could yield a 5-8% decline into 7/23. 
# The NDX held its gap-open yesterday and broke its four-day losing streak.
# The QQQ outperformed the SPY yesterday, mostly on the selloff in crude oil and the oil sector. Even if the consolidation from 6/19 proves to be just a mild consolidation for technology stocks, we are still vulnerable to a normal bull market correction of 10% going into 7/23, the 34-day Fibonacci step out from the 6/19 highs in the NDX and SPX. After the 5-10% June-July correction (a 4th wave?) runs its course, we're expecting a SPX high for the year around August 20 (+/-3 trading days) with a minimum target of SPX 2480. So we plan to buy the dip into 7/23 for a rally back into August highs.
# Gold held the 5/9 low yesterday and bounced. We may see a rally into the 7/10 Full Moon. Silver undercut the 5/9 low. The GDX took out the 21.80 low on Monday but the pattern still looks like an EW a-b-c-d-e triangle on the daily chart that is close to completion. Wave "e" now looks 5-waves down on the hourly chart.
# Silver declined in 5-waves on the hourly chart and took out the 5/9 low. We're looking for a bounce into the 7/10 Full Moon.
# Crude oil declined in a hard EW a-b-c decline yesterday. We are looking for a pullback into the 7/10 Full Moon.
# Bonds look due for a bounce.
# The USD continued to bounce on Wednesday. The rally from last week looks impulsive....