sp'weekly8b
VIX'daily3
Summary
So...minor declines for the indexes, and we have a blue candle on the weekly 'rainbow' chart. As it is, even a weekly closing blue candle will do nothing to dent the primary trend. Early next week, the sp'1935/25 zone would appear to be the very lowest the equity bears could manage, before we resume the upward trend.
Underlying MACD (green bar histogram) cycle is at the upper end of its cycle, and certainly, given another 2-4 weeks, I will be looking for the next multi-week down cycle. As ever though, we might only be looking at a very minor pull back on the order of 4-6%.
The importance of late July
In many ways, the rest of the trading year will be largely dependent on what Q2 GDP comes in at (July'30).... and of course how the market reacts to that.
We are already seeing revised GDP outlooks from some of the big institutions, and in another month, perhaps the market would be content with a number as low as 1% growth - which of course would do little to negate the huge Q1 decline of -2.9%.
Right now, I'm not entirely optimistic - from a bearish perspective. Even a July monthly close <1900 - the first key support, looks to be somewhat difficult.
Looking ahead
The only thing of note tomorrow is consumer sentiment data. I suppose if that comes in better than expected it might give the market an excuse to rally into the Friday close..although the sp'1970s look out of range.
There is also the annual re-balancing of the R2K, so expect some high vol' in the late afternoon.
*next sig' QE is not until at least next Tuesday.
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Stuck in the trenches
Naturally, I'm still focused on WFM, which continues to struggle. Price action remains weak, although at least the daily MACD cycle is offering 'something' positive for next week.
WFM daily
As things are, I'd almost consider picking up an index-long, or even TWTR-long in the immediate term, but...I'm tired.. and until I'm out of WFM, I ain't much interested in adding to my problems.
Goodnight from London