2009-04-24 Market Watch: weekly analysis

[Last weekly analysis.]  In the seventh week, the market backed off a little bit.  On SPX index futures it’s actually flat.  Essentially the market was trying to break the consolidation region then bounced back down significantly (the long shadow), now it is trying one more time.  The upward momentum is weakening nevertheless, so a pullback week is expected.

Overview of World Markets and Sectors

Nothing to say, the uptrend is not changed at the moment while the emerging market is still leading.

world markets relative strengths

The next chart shows the MSCI World/EAFE/Emerging Market, Shanghai Stock Exchange Composite Index, Hang Seng Index, and Nikkei 225 index.  No higher high in the past week, which is the first sign of weakness.

Major indices, commodities, and US dollar are shown in the next chart.  The weakening of US dollar has pushed up the oil and commodities and may continue to do so.  Gold is bouncing back up, and this is fishy.  All other markets seem strong, specially the Nasdaq and transportations.

Sector overview chart.  Industrials, materials, and technology are bullish.  There is no obvious sign of weakness.

SPX

The rising wedge mentioned in the last weekly report has changed to an ascending channel as expected, the upside target over the intermediate term is still the same.  Note that MACD is tempting to give a negative crossover.

SPX daily ESM9 2-hr

SPX wave counting overview update

XLF and SKF

XLF has not made a higher high in the last week, so the counting is changed.  Monday will be crucial for XLF, a new high will lead to a more bullish outlook in the intermediate term.

XLF daily

Currency Futures and Forex

US dollar: now the downtrend is resumed which is confirmed by both the EMA crossover and price pattern.

USD/SGD: the trend is down.  No immediate support below the current level.

EUR/USD: uptrend … watch out the overhead trend line.

Commodities

Crude oil: uptrend may be resumed due to the weakening dollar.  No chart update.

Gold: uptrend in the short term, however it should breakout from the descending channel in order to confirm the uptrend in the intermediate term.

2009-04-24 Market Watch

7:22am: market seems strong.  Oil goes up, dollar down, futures gapped up.

ES and XLF 5-min market breadth oil and dollar futures hourly

Note that CPC and TRIN are quite high, which are bearish signs.

8:01am: NQ made a new high, ES is making an ascending triangle.

ES and NQ

8:13am: TRIN is high, TICK is going down, ChiOsc is down, RSI and STO are having negative divergence.

11:15am: response to bank stress test.

ES and XLF INDU 15-min market breadth

2009-04-23 Market Watch

7:36am: market breadth looks quite strong.

market breadth

the market wants to go higher while still congested under EMA 50.

ES 5-minSPY 5-min

In the longer time frame, the pullback is not over yet.

SPY 60-min SPY 15-min

7:51am: crude oil is recovering a little bit.

CLm9 hourly

At the moment, YM is weaker than ES and NQ.

8:02am: test today’s low, it should go lower.  Now NDX should be weaker than SPX according to the market breadth.

ES 5-min Market breadth

8:12am: take a look at ESM9 2-h chart.  The wave after (B) does not seems to be wave 1 of corrective wave C.  Looking forward to more downside.

8:17am: temporary support is broken, more downside ahead.

ES & NQ 5-min

8:20am: ES is going to break the ascending channel.

ES 2-h

8:25am: a little bit of positive divergence on ES 5-m, XLF filled the gap.  May bounce back up for a while?  No trading against the trend.

8:55am: NDX is weak.  The market is relaxing before making a new intraday low.  Watch for potential breakout on ES 2-h.

market breadth  ES 5-min ES 2-h

9:10am: oil and dollar do not support the downside movement.  Maybe the LOD is set?

ES and XLF 5-min

9:17am: here is a high risk long entry.  Note the positive divergence.  Target: ema50.

ES and XLF 5-min SPY 5-min

9:55am: target reached.  Oil is pullback slightly,  dollar is falling.  Look forward to further rally.

ES and CL 5-min

TICK > 1000, TRIN > 1, first time go over EMA 50, STO overbought, pullback! (TICK < 1000 TRIN < 1 bounce back)  heard from laoda.

SPY 5-min

10:54am: it almost reached HOD and starts pulling back.  Oil is also pulling back.

11:12: pay attention to financials, it’s moving.  Big sell off is not ready yet.

11:37: oil is rising madly…again.  Be careful, no short here.

12:24: dropping.  Hopefully it could fall hard.  I prefer small white candle or big red one.

market breadth ES and XLF 5-min

EOD: small white candle.  Intermediate term down almost confirmed.

SPX daily ESM9 2-hr