IWM (representing Rus'2000)
Nasdaq Comp
Sp'daily5
Trans
Summary
Of the daily index charts I regularly track, the IWM chart is the most bearish I can see. We have a 7 candle flat top..with a doomer black candle, warning of a failed rally.
Generally speaking, the transports and IWM (rus'2000) are the most volatile indexes, and over the years, I've often seem them lead the way.. sometimes by mere minutes, other times, by days..even weeks ahead of the bigger indexes.
So..keep an eye on IWM next Monday, see if it can break back under 81, which would be a real sign of index weakness.
As for the SP', my best guess remains we are still due a further pullback, to around 1385/75, within a few trading days..just before FOMC on Wednesday afternoon ? However, such a bearish outlook would have to get thrown out if we break sp'1423 at any time, and we're a mere 5pts from that.
Underlying momentum still positive
If you take a look at the MACD (blue bar histogram) its still generally ticking lower on all the indexes, but it remains in very strongly bullish territory. Even if the market declined for ALL of next week, the momentum would still be moderately positive.
Best guess would be we see 3-4 daily ticks to the downside, and then a secondary lower tower on the MACD cycle..by around Christmas eve.
It will be at that point, when I will look to be re-shorting into year end, and across all of January.
So, to be clear, I am short into the weekend, seeking a few days lower, but then a further wave higher into the Christmas trading week.
A little more later.