Andre Gratian | TalkMarkets | Page 7
Owner at Market Turning Points
When I was a stock broker years ago, a friend introduced me to technical analysis of the market and it is not an exaggeration to say that I fell in love with this approach! Ever since then, it has become an increasingly important part of mylife, and I frequently spend 8 or more hours per day in ...more

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Point & Figure Overview Of SPX
The combination of P&F projection to 3240 plus the cycles due to make their lows in February offer the best hope for an end to the uptrend from 2856.
SPX Makes New Weekly High
Both the IWM and SPX​ indexes made a new weekly high and closed higher, persisting in their intermediate uptrend with no significant alteration of their relative strength. SPX did reach 3180, which could turn out to be an intermediate high.
Long-term Bullish Trend Has Higher To Go
The bull market which started in 2009 shows no sign of having run its course. It was not clear if SPX would retest its 12/18 low of 2346 or surpass it before making a new high, but recent action seems to have eliminated this possibility.
Near-Term Correction Possible
Neither SPX, nor IWM​ is showing signs of an important top forming at the weekly level. Last week, both made new 2019 highs. For the SPX this is also a new all-time high, but nothing has changed in the relative strength between the two.
Topping Behavior
We appear to be moving closer and closer to a reversal, but there may still be room for a little more distribution to take place before we end the uptrend from 2856.
SPX Grind Higher May Soon Correct
For the past three weeks SPX has been grinding higher, seemingly glued to the exterior of the lower line of the blue channel which started at the 2346 low, a strong resistance line, and sooner or later, prices are going to fall away from it.
Trade News Still Relevant?
The continued advance in SPX is at least partially due to the recent bottoming of the 40-wk cycle.
Cycles Peaking
SPX is in the process of creating an intermediate top. We stated previous that multiple cycles would now be peaking. Negative divergences are now showing in the daily and hourly indicators strongly suggesting that we are near reversing the trend.
Intermediate Topping Process Continues
In spite of some additional short-term strength to a new all-time high which is primarily driven by strength in the NDX, SPX is most likely putting the final touch on a large intermediate top.
More Congestion (Distribution)
SPX may not be very far from starting a correction which could rival if not surpass the one which occurred at the end of last year. Only an immediate and obvious resurgence of buying could alter this perception.
Back To Neutral
After a plunge of 137 points to 2856 early in the week, SPX ​staged a strong two-day rally back to 2952 to end the week with a minor loss instead of something much larger, had the 40-week cycle continued to push prices lower.
Looking Toppy
Although SPX pushed a little higher last week, multiple signs have appeared that could be advance warning of a reversal in trend.
A Holding Pattern
In early August, SPX found support at the bottom of its intermediate channel from 2346. This started a consolidation process which is likely to be resolved to the downside before too long.
Correction Continues
The correction is progressing normally, marked by high volatility.
Oversold Condition
The first phase of the correction took the SPX down about two hundred points. It is currently rallying from an oversold condition and getting ready to start on the next phase of the decline.
Increasing Technical Weakness
After being stymied by discussions of a rate cut at the next FOMC meeting (7/30-31) the minor cycle has regained control and is expected to drive prices lower into Monday/Tuesday.
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