07/08/2011 Market Outlook (Could see some weakness the next week)


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SHORT-TERM: COULD SEE SOME WEAKNESS THE NEXT WEEK

Two cents:

  1. Could see some weakness the next week, at least won’t rally huge.
  2. Still expect higher high ahead as mentioned in 07/07 Market Outlook. The reason I reiterate here is to imply, although I expect some weakness the next week, but I don’t mean drop right away, could be some back and forth, and usually the 07/07 highs would be revisited first.

Why expect some weakness the next week?

  • As mentioned in 07/08 Trading Signals, red Non Farm Payroll day most likely means a reversal. The chart below highlighted all the red Non Farm Payroll days since the 2009 bull market. Clearly we can see there’s only 1 exception out of 10, so although superstitious it sounds but the odds just are too high to be ignored.

RedNFP

  • Although the Friday intraday feels very bullish but the fact the daily hollow red bar formed near highs usually means a top, besides, the ChiOsc is way too high now.

QQQWithChiOsc

  • Nothing on Earth is beyond gravity, so MACD Hist cannot stay high for ever, the chart below at least doesn’t agree a huge rally the next week.

QQQWithMACDHist

  • The chart below is from Schaeffer, seems bearish on July Expiration Week.

JulyExpirations

INTERMEDIATE-TERM: BULLISH JULY

See 07/01 Market Outlook and 07/05 Market Outlook for more details.

SEASONALITY: BULLISH MONDAY BEARISH FRIDAY, BEARISH JULY EXPIRATION WEEK

According to Stock Trader’s Almanac:

  1. Monday before July expiration, Dow up 6 of last 7.
  2. July expiration day, Dow down 6 of last 10, off 390 points (4.6%) in 2002.

Also see 07/01 Market Outlook for July seasonality chart

ACTIVE BULLISH OUTLOOKS:

ACTIVE BEARISH OUTLOOKS:

SUMMARY OF SIGNALS FOR MY  PUBLIC CHART LIST: 

  TREND MOMENTUM COMMENT
Long-term 2 of 2 BUY
Intermediate 5 of 5 BUY 5 of 5 NEUTRAL Cobra Impulse in BUY mode; Non-Stop in BUY mode.
Short-term 6 of 6 *NEUTRAL
  TREND COMMENT
QQQ & Weekly UP *NAADV MA(10) and ChiOsc too high.
IWM & Weekly UP *ChiOsc too high.
SSEC & Weekly *UP  
EEM & Weekly UP
XIU & Weekly DOWN *The last 4 bars don’t look good.
DAX & Weekly UP *The last 4 bars don’t look good.
TLT & Weekly DOWN  
UUP & Weekly DOWN
GLD & Weekly *UP *Symmetrical Triangle?
USO & Weekly *UP *Bearish Abandoned Baby?
XLE & Weekly UP *Evening Star? ChiOsc too high.
XLF & Weekly UP
IYR & Weekly UP  
XLB & Weekly UP *ChiOsc too high.
  • * = New update; Blue Text = Link to a chart in my public chart list.
  • UP = Intermediate-term uptrend. Set when weekly buy signal is triggered.
  • DOWN = Intermediate-term downtrend. Set when weekly sell signal is triggered.
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