*Please make sure you understand how to use the table above. The main purpose of this report is to provide information so contradictory signals are always presented.
SEASONALITY: MOSTLY THE MONTH’S LAST TRADING WEEK WAS RED SINCE AUG 2009
See chart below, interestingly, ever since the Aug 2009, mostly the last trading week of each month was a red week.
Especially the last 2 trading days of each month. Still remember this setup?
CYCLE ANALYSIS: THE NEXT IMPORTANT DATE IS 05/06
See 04/16 Market Recap for more details. Please don’t read too much into cycle analysis, all I know is that the next potential turn date is 05/06 (+-) which could either be a top or a bottom depending on how the market marches to that date.
INTERMEDIATE-TERM: EXPECT ROLLER COASTER AHEAD
See 04/16 Market Recap for more details.
SHORT-TERM: EXPECT A NEW HIGH AHEAD BUT COULD BE A RED WEEK THE NEXT WEEK
Start with the good news first, 0.2.3 NYSE McClellan Oscillator, the NYHGH (NYSE New 52 Week Highs) below reached a new high last Friday which means that SPX will have a new high ahead. See charts below for the past patterns, although the NYHGH very high reading may mean a red day the next day but a top could only be formed after NYHGH negative divergence. So in another word, even the market starts to pullback the next Monday (which by the way is unlikely if you remember the chart 6.5.2a Weekday Seasonality Watch) there’ll be at least a rebound to a new high thereafter (so that NYHGH could have a chance to form a negative divergence).
4.1.0 S&P 500 Large Cap Index (Weekly), my guess is that Fib 61.8% at 1228 could be the new high since it’s not far away now. However, see vertical red solid lines (PPO(1,40,1)), every time the SPX was too high above MA(200), the next week was a red week. So combining with the above mentioned seasonality factor – mostly every month’s last trading week was a red week since Aug 2009, therefore chances are good that we might see a red week the next week.