STOCK MARKET STRATEGY FOR APRIL 17, 2016: The stock market continued its rally after a short-term semi-oversold condition early in the week. With all the breadth indicators at neutral readings, the market can go in either direction from here. If we should correct from here, I’d be looking to buy the dip. Until we have a key reversal day that starts sharply higher and closes sharply lower, I’d expect the market to continue drifting higher while climbing the proverbial “wall of worry.”
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: The stock market may correct from here and present a buying opportunity either at an oversold condition or at the 200-Day Moving Average some 70 points lower in the S&P 500. In any case, such a buying opportunity would be at least a week to 10 days away at a minimum. On any strength, I’d look to lightened up on trading positions as this rally is getting a little “long in the tooth” and due for a breather. My hunch is that this coming week will see a top in the market.
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STOCK MARKET STRATEGY FOR APRIL 9, 2016: The stock market had a mild correction during this past week with several internal indicators moving into range of a short-term buy/oversold signal. I would expect a bottom to arrive this coming week with a retest of the April 1st high later in the month. But with neutral breadth readings across the board, the stock market can surprise us and swing in either direction. Look towards any retest as an opportunity to lighten up on overextended positions.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: Be ready for a short-term bottom and a quick move back to the previous DJIA high of 17792 on April 1st. That may be a good opportunity to lighten up on your positions with the anticipation of a more extended correction and bottom in May.
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STOCK MARKET STRATEGY FOR APRIL 3, 2016: The stock market continues to push upwards climbing the proverbial “Wall of Worry.” I would expect the All-Time Highs to be tested and then retested soon. The month of April should be a time where the markets does all of this correcting, but watch out for May as it could be a time of real decline. But for now, continue to lighten up positions as the general market approached the old highs.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: The stock market should be testing the All-Time Highs in the next week to 3 weeks. Right now the indicators are at their lower end and allow for more upside to continue. This is not a time to be short the market, but instead an opportunity to lightened up on overextended positions.
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STOCK MARKET STRATEGY FOR MARCH 7, 2016: The stock market continued its rally to a point where it is clearly overbought. This should put a cap on any further advance for the time being. The general market should either correct downwards or sideways for at least a week to 10 days. Short-term, steep rallies on low volume such as we’ve witnessed lately are more characteristic of bear market, rather than bull market rallies. So it would be prudent to take some chips off of the table now and buy any oversold dips should they appear later in the month.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: The stock market has had a good run of late, but it’s not the optimal time to buy right now. Instead, lighten up on weaker or over-extended positions in order to raise cash for the next buying opportunity which could occur around March 17-20th. I believe that the February 11th bottom was an important one. It was a new closing low which was below both the Jan 20, 2016 and August 2015 bottoms – but was not confirmed by other internal indicators. In my book and the late Joe Granville’s as well, this represents a significant bottom. That means that all dips should be bought from now on.
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STOCK MARKET STRATEGY FOR FEBRUARY22, 2016: The stock market rallied sharply from the previous week’s low. With all of the breadth indicators near the top of their range and peaking, a correction of sorts can be expected from here. In the event we get an immediate rally from here, look to it as a chance to lighten up on positions for a more pronounced decline to follow. Be ready for anything and stay nimble in your stock market trading this week going into the always tricky end of the month.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: The stock market may correct into the end of this week giving traders another chance to ride this market up into March. If we should pull back here and get an oversold condition, I would recommend taking positions in broad-based Exchange-Traded Funds such as DIA, SPY, and QQQ. Otherwise, lighten up if the market moves up immediately and gives us clear overbought readings.
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STOCK MARKET STRATEGY FOR FEBRUARY15, 2016: The stock market declined into last Thursday afternoon with a chance to make a new closing low for this cycle. In fact, it turned around mid-day, made a new closing low, and advanced all the way into Friday’s close. This looks like a successful test of the previous lows although there could still be one more sharp decline in the near term. Look to buy any dip towards the February 18-20 time period especially if that weakness is not confirmed by strength in breadth and other major averages particularly the Nasdaq & DJTA.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: The stock market may have already bottomed on last Thursday’s mid-day and closing DJIA low. But often times a retest can occur in 5 trading days. Hence, if there is a drop into this coming Friday that is accompanied by non-confirmations in several indicators, I’d look to buy strongly into this weakness. If this scenario should play out, I would recommend taking positions in broad-based Exchange-Traded Funds such as DIA, SPY, and QQQ. One more move to the downside may be all it takes to get the weak hands to capitulate and mark a solid bottom for the intermediate time frame.
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STOCK MARKET STRATEGY FOR FEBRUARY6, 2016: Last week, the stock market topped out over the short term. With the internal indicators in neutral positions and trending down, a smart market player can anticipate a move to a deeply oversold condition within the next 4 to 10 trading days. Recent monthly lows have occurred around the 18th-20th of the month so a bottom may also appear in that time frame. But before that can happen, expect more downside action, bad news, and a retest of the previous lows.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: An intermediate term bottom may occur on the next oversold bottom. But the breadth oscillators need more time and downside action in order to reach the proper levels. When and if they do, I would recommend taking gradual positions in broad-based Exchange-Traded Funds such as DIA, SPY, and QQQ on weakness. Recognize that it will be tricky trying to catch the exact bottom and avoid the temptation of wanting to be too perfect in your timing. The earliest chance for a bottom looks like Thursday of this week. You can start taking new positions below 15,700 in the Dow Jones Industrial Average.
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STOCK MARKET STRATEGY FOR JANUARY 31, 2016: The stock market had a successful test of the previous bottom resulting in a rally on Thursday and Friday. But with the internal indicators at or near “overbought” levels, it would not be surprising to see a short-term top this week and another leg down into mid-February. So it may be wise to lighten up on long positions into strength over the short-term with the intention of buying back on the next oversold bottom later in the month.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: A short-term top may occur this coming week with the next low and buying opportunity coming in the following week to 10 days. When the next bottom comes, it would probably be smart to avoid stock-picking and just buy a mix of broad-based Exchange-Traded Funds such as DIA, SPY, and QQQ. It seems like getting too clever with stock choices is not worth complicating your trading strategy or risking any negative reactions to earnings news associated with individual stocks.
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STOCK MARKET STRATEGY FOR JANUARY 24, 2016: The stock market had an intraday panic low on Wednesday followed by a sharp rally the past two days. From here, the market should either decline to a higher low around this coming Wednesday or continue higher into an overbought condition around the same time. Continue to be cautious as the market can make big swings in either direction probably coinciding with good news from the FED or bad news centered around oil or China.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: Be ready to add to long positions on a decline to retest the previous lows. At the same time, be ready to light up your long positions in the event the rally continues into an overbought condition. This is a time of high volatility which will naturally cause emotionally-charged, news-driven investors to buy high and sell low. The wisest thing to do may be to sell the rallies and move to cash until things settle down (a successful retest of the previous lows). You’ll just have to control your fear of missing out in the meantime.
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STOCK MARKET STRATEGY FOR JANUARY 17, 2016: The stock market experienced another severe down move this past week putting it in position to challenge last August’s lows. Those who were looking for a short-term bounce to trade were hurt badly by quick reversals and large gaps down. Look for a test of Dow 15700 and a bounce from that level. Or it might take one more failed rally and plunge before the masses finally throw in the towel – marking the bottom of this cycle.
Key underlying short-term market indicators show the following:
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THE BOTTOM LINE: Be careful here. The climate right now is ripe for a crash to happen. While sentiment is largely negative and all short-term breadth indicators are severely oversold, there is still room to the downside in terms of price. If you’re going to bet on a quick bounce, look to trade on weakness below Dow 15666. But overall, it feels like the bearish sentiment needs more time to ferment into genuine “blood on the street” for public investors. One more downwards zig-zag may do the trick.
Categories: Stock Market Strategy Tags: investing, investing tips, investments, money, QQQ, SPY, stock action, stock market, stock trading, stock trading tips, stocks, tony robbins, trading, trading tips, wall street