2009-04-03 Market Watch: weekly analysis

[Last weekly analysis]  We have witnessed the most impressive four weeks of rally, which could be the biggest rally in the history at least since the bear market started in 2007.  Although SPX has not reached the consolidation yet and big loss in the last four consecutive weeks is not fully covered, the upward momentum is extremely strong and this market condition is very usual also.

SPX weekly

Overview of World Markets and Sectors

The trend is the same as the last week.  No change to the original comments.

World markets Relative strength

The next chart shows the MSCI World/EAFE/Emerging Market, Shanghai Stock Exchange Composite Index, Hang Seng Index, and Nikkei 225 index.  All markets look very bullish after a few days of pullback.  MA-20 are all pointing up.

Major indices, commodities, and US dollar are shown in the next chart.  Gold and US dollar are bearish, all other markets are extremely bullish.

Sector overview chart. All sectors are bullish especially technology sector.

SPX

Wave counting is still the same.  The right hand side is the target estimation.

SPX daily

Downside target for buying dip: 800-810, use MACD as a signal.

SPX hourly EMA crossover system

XLF and SKF

SKF is not a good buy before going back to 90.  XLF is on the edge of breakout, although it’s overbought.

SKF hourly SKF daily

Currency Futures and Forex

US dollar index: the trend is still down after the rebound is over.

USD daily

USD/SGD: at least one more down in the near term.

USD/CAD: down trend will continue.

EUR/USD: technical indicators are neutral.  Assume the uptrend will continue.

Commodities

Crude oil: it has touched the support level and bounced back up.  The trend is up, and the strategy is buy on dip!

daily weekly

Gold: long position should have been stopped out.

Direxion 3X ETF list.

2009-04-02 Market Watch

Today bears were heavily wounded by the massive rally.  Most likely we are still in the major wave A of the primary wave (2).  With the assumption of 333 structure, the first target of A could be as high as 946.  MACD and RSI show a sign of weakening uptrend though.

SPX wave counting.

SPX 60-min system

SKF is at the lowest level since 2007, while XLF failed to reach a new high today.

SKF daily XLF hourly

2009-03-31 Market Watch

SPX wave counting. normal view

SPX hourly.  the moving averages show the sign of the corrective wave.

SPX 60-min system. Sell signal is still valid.

SKF hourly.  Gap is filled, buy signal becomes weak.

today’s ES 5-min chart.

2009-03-30 Market Watch

The ending point of the major wave (5) doesn’t look alright, and the market needs to confirm it in the coming weeks. The region between 740-750 remains to be crucial.

SPX wave counting

On the following hourly chart, if SPX goes above 802-805, the market will be in corrective wave.  If it heads down again before reaching 795, the downward momentum will be very strong.

XLF hourly: sell signal confirmed, very bearish.  SKF hourly: uptrend is valid

XLF hourly SKF hourly

2009-03-27 Market Watch: weekly analysis

[Last weekly analysis].  The last weekly turned out to be a bullish consolidation and the market resumed the rally in this week.  Now the gain in the past three weeks has offset the loss in the previous three weeks, and the heavy consolidation region is not far away ahead, so it will be interesting to see how the market goes in the next week.

 

Overview of World Markets and Sectors

Over the intermediate term, all markets are very bullish especially the emerging market is ahead of all others.  Japanese market also looks promising.

World markets Relative strength

The next chart shows the MSCI World/EAFE/Emerging Market, Shanghai Stock Exchange Composite Index, Hang Seng Index, and Nikkei 225 index.  All markets are straight up without decent pullback, while SSEC is right at the previous high.

Major indices, commodities, and US dollar are shown in the next chart.  Nothing special, only the commodities are backing off due to the rebound of US dollar.

Sector overview chart. Most sectors are going straight up while the financials got stuck at the resistance, and the technology and materials look the most bullish ones.

SPX

Now the previous bearish count is invalid, and the current internal structure favors the intermediate-term bullish count, which means that the major wave (5) of the primary wave I has finished.  Then the current wave should be primary wave II in the form of corrective wave ABC, and the question is how long the first impulsive wave can last and how high it can reach.

On the hourly chart [left], the market looks neutral, however the negative divergence on RSI and MACD should not be neglected.  Note the SPX 60-min system [right] almost gives a sell signal which is not confirmed by the moving average yet.

SPX hourly SPX 60-min system

XLF and SKF

XLF chart has given four times of sell signal but none of them was approved to be reliable intermediate term signal.  So is the SKF charts  Wait and see how it works next week.

XLF hourly SKF daily SKF hourly

Currency Futures and Forex

US dollar index: bounce back up which hurts commodities and the crude oil.  However the primary trend is still down.

USD/SGD: in consolidation region.  Can break out at either side but most likely the up side.

USD/CAD: almost the same as USD/SGD.

EUR/USD: trend is down.

Commodities

Crude oil: hopefully it will touch the support level and then it’s the opportunity to get in.

daily weekly monthly

Gold: the uptrend line is not decisively broken yet, so the current level is a buy opportunity and the stop level can be set easily.

[Several random charts]

SKF daily SPX daily EWZ daily DBC daily