Stock Trading: Stocks in Bottoming Process; Reinforcing Outlook for Overall Rally into late-April/early-May ’19.
Stock Trading: Stocks in Bottoming Process; Reinforcing Outlook for Overall Rally into late-April/early-May ’19.
03/27/19 Weekly Re-Lay Alert – Roller Coasters: “More than any other, one particular analogy is used when discussing market tops and bottoms. It is the analogy of a multi-car roller coaster going over its summit and the comparison of that to a multi-faceted market passing through a peak (the inverse idea can be applied to a market complex going through a bottoming phase).
Very simply, the analogy illustrates how market complexes – with multiple components (metals, energy, currencies, equity indexes, etc.) – often see their individual components experience individual tops and bottoms at different times…
Equities recently peaked in a similar fashion with the DJTA topping first. That was quickly followed by the DJIA, other indexes, and finally the S+P 500 and Nasdaq 100.
All of the equities dropped sharply into March 8, at which time a couple of them (ESM & NQM) signaled the end of that correction, even as others projected a second decline after an intervening rally. That could now be leading to a sequence of bottoms…
Stock Indices remain divergent with the DJIA, DJTA, Russell 2000, MMX and similar indices fulfilling projections for a ~4-week, ‘a-b-c’ correction from late-Feb. (Feb. 19 – 25) into March 25 – 26.
The DJTA spiked to new correction lows (following the lead of the Russell 2000) and came within a few points of it’s March ’19 monthly HLS at 9970. That is triggering an initial rebound.
At the same time, the ESM & NQM twice neutralized their daily uptrends as the NQM spiked to its daily & weekly HLS (7290 & 7281). That sets the stage for a rally back to the highs, as long as they do not generate daily closes below 2789/ESM & 7276/NQM.
On a related basis, the DJIA & DJTA twice neutralized their weekly uptrends and need weekly closes below 25,208/DJIA & 9,994/DJTA to turn those trends down. If, however, those indexes are to maintain the potential for higher highs in April/May, the weekly trends should not turn down.
With most of these indexes fulfilling short-term and intermediate downside objectives while holding support, it ushers in a pivotal 1 – 2 days when [reserved for subscribers]”
Stocks completing corrective phase and remain focused on potential for additional upside into late-April/early-May. Nasdaq 100 testing support at 7241- 7281/NQM and should enter new wave higher. This continues to corroborate the overall outlook for equities – projected to set 3 – 6 month or 6 – 12 month lows in late-2018 (~3.25-Year Cycle) and then see a strong, multi-month rally into April/May 2019 (weekly cycles pinpoint late-April – early-May ‘19 as ideal period for a peak) – when a significant peak is expected.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.