S&P Confirms the NASDAQ Signal?

 

BarroMetrics Views: S&P Confirms the NASDAQ Signal?

A 10% correction in the wind?

Before I begin – if you are planning to take part in Singapore, a caution: we have only 18 seats left. I expect these gone today. Do register early or you may miss out. If you do miss out, register for the live-streaming. (I prefer being present, but it would be better than missing out!)

Turning to today……..

An important event occurred: the S&P took the first step, of a two-step confirmation, to confirm June 29’s NASDAQ sell signal.

Let’s turn to Figure 1, NASDAQ, showing the 13-week swing (black line, quarterly trend). It shows that line will turn down at 5295. It also shows the S&P 13-week swing; its line turns down at 2315 (both basis cash)

Figure 2 shows the 18-day swing and 5-day swing (blue line, weekly trend). The 18-d shows no change in trend, whereas the 05-day shows the breach of the uptrend. There is a Normal Change in Trend pattern. But, the filters, momentum, time and price have yet to be triggered. Consequently, we may still see a rebound in the 5-day generate buy signal.

Figure 3 shows that the 18-day correction will nudge into 13-week corrective territory at 2366 Penetration of 2323 will confirm that we are seeing a 13-weeek correction. A move into the the ’80-120′, 13-week correction band (grey lines) is important. Why?

Because a 13-week correction suggests an 18-day impulse move. Of course, an  18-day impulse move encompasses a 05-day swing trend down.

By combining the two, the stats suggest a minimum 10% correction, giving us a price target of around 5300 to 5310.

In the two-step confirmation, the second step will be a tandem, bearish conviction-close (of at least normal range and volume).

Will we see that tonight? We may, we have NFP at 8:30 EST. Expectations are for a figure of 170K with the unemployment rate coming at 4.3. The consensus ranges:

  • NFP 140k to 200k
  • Rate 4.2% to 4.4%

Let’s see what happens.

FIGURE 1 13-week NASDAQ & S&P

 

FIGURE 2 05-day and 18-day NASDAQ & S&P

FIGURE 3 18-d ’80-120′ Band

2 thoughts on “S&P Confirms the NASDAQ Signal?”

  1. HI RAY , LOOKING AT THE GEOMETRIC PRICE STRUCTURE OF S&P , WALL ST ( DOW JONES ) NASDAQ ( US TECH. ) UK 100 I NOW PREDICT THESE MARKETS WILL RALLY NEXT WEEK AND CARRY ON UP TO MAKE NEW ALL TIME HIGH,s BEFORE PRICE FALLS . ALSO THE EUR/USD WILL NOW MOVE DOWN . REGARDS , KEN UK.

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