Professor’s Comments February 16, 2017
Posted by OMS at February 16th, 2017
The Dow rallied for another 107 points, closing at 20,612. Volume was moderate, coming in at 108 percent of its 10-day average. There were 267 new highs and 15 new lows.
Yesterday’s rally was another Big Move predicted by the small change in the A-D oscillator. It was the second small change signal or ‘relatively’ small change signal in the past two days. And after yesterday’s rally, there was yet another small change signal from the A-D oscillator, so, we could see yet another Big Move within the next 1-2 days. Only this time the Big Move could be down.
I say this for several reasons. The first is because there is a Fibonacci Phi Mate turn date scheduled for today. This turn date has a window of 2 days on either side of 16 February, so we could see the market start to turn either today or tomorrow.
The recent impulse rally since 7 February has helped clarify the overall pattern. Since the VTI re-entered the Trend Mode on 7 February, the move has been straight up without pause. This is typical of the third wave in an Ending Diagonal Pattern.
So, IF the market turns on this Fibonacci Phi Mate date, it would likely mean that next wave down would only be Wave 4 of the Ending Diagonal, with one more final wave up required before the pattern is complete.
Looking out, there is another Phi Mate turn date scheduled for mid-March, so it’s possible that the market retreats for 1-2 weeks in Wave 4 down before making one final run into mid -March. The fact that the Dow has rallied hard since its December – early February consolidation period makes this a high probability scenario.
Yesterday’s rally caused the Dow to remain above its Upper Bollinger Band, so the set-up for a Bollinger Band Sell Signal was NOT triggered. The Russell 2K small cap index closed back above its Upper Bollinger Band again last night, so a Set-Up for another Sell Signal is on the Board for the small cap index.
Yesterday’s Sector Report showed 21 strong sectors and only 3 weak. The Transports, Semiconductors, and Banks continue to lead, with Service, Telecoms, and Food-Drug, lagging. Since early November, except for a handful of days, the Semis, Transports, and Banks have been leading the market, and especially the Dow higher.
Gold (the metal) had a nice day yesterday, but it had little effect on mining stocks. GLD rose 0.52 cents to 117.45. GDX rose 0.01 cents to 24.93. The VTI on GDX remains in the Trend Mode, but continues to head lower. Like I mentioned yesterday, I’m not concerned about this now because the ETF appears to be completing a minor wave 2 Blade within a major (wave 3 Up) Uptrend. The 50-day moving average on GDX is now above the 200 and moving up. In other words, the ETF is now in an Up Trend.
With GDX now in an Up Trend, I start watching the 2-period RSI Wilder. Last night the indicator closed with a slightly oversold reading of 34.4. So, this morning, with GDX now slightly oversold and in an Up Trend, I’ll be looking for Rifle Trades on the shorter-term bars.
BTW, the pullback in GDX that has occurred for the past 5 days has formed the ‘Blade’ a small Hockey Stick Pattern. This pattern has a target near the 27.5 level. If the equity markets start to pullback after today’s Phi Mate date, gold could be a nice place to be.
That’s what I’m doing,
h
Market Signals for
02-16-2017
DMI (DIA) | POS |
DMI (QQQ) | POS |
COACH (DIA) | POS |
COACH (QQQ) | POS |
A/D OSC | SM CHG |
DEANs LIST | POS |
THE TIDE | POS |
SUM IND | POS |
VTI | POS-T |
One hour video recorded from May 28, 2016 The Professor’s Signs of a Major Market Turn – Prospectives and the Projected Timing and Levels One hour streaming video – includes webinar handouts The Professor usually holds an update class whenever the Market looks like it may be making a major turn. If you have been following the Professor’s Comments you know that a turn is due….. LEARN MORE
Not sure of the terminology we use? Check out these articles
The Hockey Stick Pattern
The Creation of Waves and Trends
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Category: Professor's Comments