Will the NDX determine where the SPX goes next?

This is an update to the July 8 Premium Member Weekly Digest. 4th waves tend to typically retrace 23.6 to 38.2% of the prior 3rd wave. In this case intermediate-iv of intermediate-iii on the NDX, and these retrace levels correspond to $5600-$5414. It is impossible to know before hand which retrace level it will be…

DOW JONES monthly chart update

With the month of May now in the books, it’s time to review the monthly charts. Here we’ll take a look at the DOW JONES. What we can observe is that relative strength (RSI5) is very high (i.e. strong uptrend), but rather overbought and displaying slight negative divergence. Over the past 20 years similarly high…

Is the S&P500 heading for 2500 next?

Two weeks ago the SPY:TLT ration suggested a correction was ahead, see here. Correctly so, but the correction only lasted 2 days and that was all the bears got. Yes, these indicators can correctly foretell of pending market moves, but will not tell us the extent of the move or for how long it will…

SPY:TLT ratio suggests a pending correction

In February we noticed some very short term negative divergence between the SPY and TLT (the 20+ years treasury bonds ETF ): see here. This short term divergence was negated (divergence is only divergence till it isn’t), as stock markets moved higher. However, large scale negative divergences often foretell of a larger pending correction (see Figure…

S&P500 remains on track for 2300-2280.

“Less is more.”, “No need to change the winning team.”, “Forewarned is forearmed.” Great sayings that mean nothing is you can’t back them up. Well, starting late-February we already warned of an impending intermediate-term market top and correction, which we then backed up again early-March. See here and here. We then showed the weak weekly…