Based on consumer discretionary spending, historical market turning points and the growing uncertainty surrounding interest rates, we are in the ideal target time window for an SPX top in late March to early April with April 4th jobs and April 14-17 inflation being the next key dates. Based on technicals including the T-Theory Confidence Indicator, distribution patterns, VIX/margin/sentiment, retracement of 1576 imminence, the EDT pattern, OEW and some Fib wave estimations, we already approached the ideal price window of 2130ish yet may still reach it.
My projected EDT from October 2014 is still in play for both SPX and Dow. However, they exhibit different patterns for the 4th EDT wave. Dow looks like a typical zigzag while SPX looks like it may be forming a sideways triangle. In either case, one more surge near/past all-time highs is warranted. Yes, an intermediate-term top may have already been seen, but we won't know otherwise until SPX 2115/Dow18200 is exceeded and until oversold technical indicators are reset. I think we have at least a few days to see how far Janet Yellen's dovish Friday night comments can carry the markets and probably won't see the final surge or top until April 3,4,7,8 around the jobs report. I still caution the possibility that SPX has been building up a series of 1-2s (or maybe even a larger wave 4 triangle) that could explode higher, but obviously my data suggests otherwise and we have a nice stop at 2179 where the EDT scenario would be negated and a nice EDT origin price target of 1820 giving us a 6:1+ reward-risk ratio. If I am right about the EDT and its origin of 1820 and the consumer-spending-induced 8%+ drop ending in the last half of April or first half of May, we could be in for a nasty 3-5 week 10-20% mini-crash beginning this week or next. Good fortune.
No comments:
Post a Comment