Current Technical Trend…
- VIX levels at high 15’s as momentum consolidated
- Monitor for the two ETF indices to remain in sync as supporting indicator of momentum (Up or Down)
- Advances-Decliners/INDU in sync – UPTREND
- IBD Psychological Market Chart indicators – UPTREND
- Indices at 10 period moving averages with open gaps both above/below
- Lowest Open Gaps
- ES: 1589 | NQ: 3864.75 | RTY: 1462.1 | YM: 14745
Market Momentum – ETF’s
- Current IBD Outlook: Market Confirmed UPTREND
- IBD ETF strategy: 100% invested
- Current Trend in key ETF Indices may be FOUND HERE
Key Events in the market this week
- USA: Earnings, FOMC, Home Sales
- Q1 earnings:
- Adidas, Fed Ex, Micron, KB-home
- FOMC expected to raise interest rates
My 3 Cents…
Short and simple because truth be told, sideways price action just doesn’t give me much to think or write about.
Contract rollover, CPI data out and FOMC ahead in week 12 was enough for the market indices to pull back to their perspective 10ema’s. CONSOLIDATION is the key word here as the key technical charts that I follow each week as posted above to paint a picture of momentum or pullback remain in an UPTREND. As we all may know, consolidation is an opportunity that will breakout in either direction.
Q2 will soon close and a fresh new season of earnings to roll in and either support this momentum or give the market reason to pullback further is yet to be seen. The waiting game may be just what the market will play out here and could last for the remainder of 2018 if need be. I implore you to use the easiest and simplest of technical indicators and monitor the moving averages and look for crossovers and where price is in relation to. While the NQ has made new all time highs and RTY has bounced back, it is the ES/YM that remain to hover and cling to their perspective 10/50 period ma’s.
Big Picture: Keep your eyes on the Q2 re-balancing of your long term portfolios, swing positions watch for the breakout of the 10ma and intraday, always be ready in both directions for setups that are all in sync and with the highest probability of trend momentum as seen below.
Watch for MML setups on price action break above resistance high and back under resistance low for first signs of a pullback. Downside, watch for open gaps to be closed and 50% pullback as 1st level of support.
Swing ETF positions should be careful about chasing at the highs as pullbacks/quarterly 3sig re-balance are always opportune times to re-enter the trend. Quarterly re-balance in Q2 2018.
Attempting to determine which way a market will go on any given day is merely a guess in which some will get it right and some will get it wrong. Being prepared in either direction intraday for the strongest probable trend is by plotting your longer term charts and utilizing an indicator of choice on the lower time frame to identify the setup and remaining in the trade that much longer. Any chart posted here is merely a snapshot of current technical momentum and not indicative of where price may lead forward.
- Outlook: BULLISH CANDLES
For the long term investor, a solid strategy that only requires 4x year portfolio review by achieving a steady 3-percent quarterly growth in a small-company stock fund by skimming off excess quarterly profit into a safe fund that’s later used to make up shortfalls in weak quarters.
Somebody needs to sit the president down and explain that America’s trade deficit is America’s own doing, not the result of evil trade practices overseas. Kudlow could be the one for the job, using his belief in supply-side economics that he shares with the president to create rapport for talking up free trade.
- Quarterly Re-Balance: SELL index account; BUY bond shares
- 22.6% gain for 2017
- Cryptocurrencies are dead.
- In an uptrend, pullbacks are accepted as long as the close doesn’t go below the previous important low.
- In a downtrend, reactions are valid as long as the previous important high is not taken.
- haDelta on weekly charts point to a weakness just below zero.
- The monthly trailing-stops remain relevant. Their violation is a serious negative signal. The rest is noise.
- A good trailing-stop takes most emotions out of a trade or investment.
Moors & Cabot
- The impact of the hurricanes and the California fires may have a bigger impact on the US economy in 2018-19 than the changes to individual taxes.
As always, leave your bias at the door of where you think the market should be, watch the charts in front of you and stay away from the Z-Vals. Be ready in both directions. Trend will reveal itself on Heikin Ashi bars and proper trade management will keep you in the trend.
Thanks for reading and remember to always use a stop at/around key technical trend levels.
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CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.