As wild short term volatility chews up swing traders and spits them out, the market averages remain in an uptrend, and look poised to move higher. But fewer stocks will lead the way. Most may not participate. Technical Trader subscribers click here to download the complete report.
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Cycles have flattened, with the 6 month and 10-12 month cycles apparently in trending mode. This means that there are neither price projections nor time guesstimates. In these circumstances we need to resort to trend following indicators.
Cycle projections are nonexistent at the moment. We’re flying blind as to likely upside targets. Downside projections were hit in last week’s downdrafts. Chart structure points to xxxx xxxxx xxxx xxxx (subscribers only) as the 13 week cycle turns xxxx (subscribers) in the context of a xxxxx (subscribers) 6 month cycle trend.
Cycle time projections point to a final top in xxxxxxx (subscribers).
The third rail chart faces a resistance trend convergence at 4180 on Monday. If cleared, the next resistance cluster is up around xxxx (subscribers). If they turn down, there are 7 rising trendlines representing potential support starting at xxxx, down to xxxx. They would need to be broken to signal an end to the downtrend.
On the weekly chart, the uptrend remains intact. Trend support is at xxxx (subscribers). Resistance and likely initial upside target is xxxx. If cleared xxxx would be the next target.
On the monthly chart, May began with trend support at 4050, and resistance at roughly 4300. The long term cycle momentum indicator remains bullish.
Cycle screening measures improved slightly. They’re a mixed bag that give us no reason to expect a big move either way. However, they suggest that any rally will be narrowly based. A few strong stocks could lead the averages higher, but most stocks wouldn’t participate.
The chart pick list had an average gain of 0.2% with an average holding period of 10 calendar days last week. The whippy rangebound market took its tool.
For the week as a whole, there were 158 buys versus 70 sells, a spread of +88. That’s down from last Friday’s 224 buy signals and 125 sells, a spread of +99. The 5 day total peaked on Thursday at +218.
We haven’t seen that play out in prices yet. But probability says that it will. It should happen this week. That report is published here.
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These reports are not investment advice. They are for informational purposes, intended for an audience of investment and trading professionals, and other experienced investors and traders. Chart pick performance changes week to week and past performance may not indicate future results, as you know. Trading involves risk, and these reports assume that you understand those risks and manage them according to your tolerance.