Professor’s Comments September 12, 2019
Posted by OMS at September 12th, 2019
The markets rallied hard yesterday as predicted by the small change signal from the A-D oscillator. The Dow finished with a gain of 228 points, closing at 27,137. The NASDAQ and SPX were up 86 and 22 points, respectively. Volume on the NYSE was heavy, coming in at 114 percent of its 10-day moving average. There were 102 new highs and only 6 new lows.
Yesterday’s rally appeared to be associated with final waves of the zig-zag pattern for ‘c’ up of Wave 2 up. If the Dow remains below its July high of 27,399, the pattern will remain valid and the Dow should trade down to the 24,000 level on Wave 3 down. On the other hand, IF the July high is broken, the overall pattern would remain Bearish, however the Dow could trade up to the 27,600-27,800 level before falling below 24,000. Right now, this alternate scenario has a lower probability than the primary scenario, but it could happen. From a technical perspective, the alternate scenario would change the wave count, but should not change the intermediate term outcome.
The market remains in very fragile condition.
The market timing indicators on the Dow, SPX, and Russell 2K are now Positive. The NASDAQ remains on a Neutral Signal. So, the signals are still mixed.
The Tide and Dean’s List are Positive.
The Sector Ratio remained at 21-3 Positive after yesterday’s session. The Strong Sector List was led by Service, Healthcare, Semiconductors, FoodDrug, and Consumer Products. The Weak List was led by Real Estate, Leisure and PharmaBio. About half of the RS ratings of the sectors on the Strong List are 1s and zeros, so one or two down days could easily turn the Ratio negative.
Model Portfolio: Yesterday, the Model re-purchased the 1,200 shares of DXD it sold on Monday at a cost of 25.42 per share. If the Dow remains below the 27,399 level, the Model will likely continue to hold these shares as insurance against a rapid overnight decline in equities caused by a negative news event. The Model will hold off on re-purchasing the shares of SQQQ until the short-term indicators give say so. Available cash is currently $95,843. The Model continues to look for high probability trades to put its cash to work.
By moving to the sidelines on Monday, the Model’s avoided a loss to its inverse positions. The Model continues to show a gain of 26.1percent, even though trading has been a challenging experience for the past month.
Gold bounced from oversold conditions yesterday as expected. GLD gained 0.85 cents to 141.03. I wouldn’t get too excited about the bounce, at several more rallies and declines will likely occur before GLD completes its Wave 4 triangle. My target for GLD remains at the 137 level. Once Wave 4 completes, gold (the metal) should rally to the 1,600 to 1,650 level as Wave 5 of Major Wave 3 up unfolds. The Model is just being patient and waiting for a signal change before buying gold again.
The Model Portfolio is being shown for educational purposed only. The Buy/Sell actions in the Model Portfolio are made based on technical indicators that can and do change frequently and should NOT be considered as recommendations for trading an actual portfolio. Any gain or loss in the Model Portfolio should not be used to predict future performance of the Model.
That’s what I’m doing,
h
Market Signals for
09-12-2019
DMI (DIA) | POS |
DMI (QQQ) | POS |
A/D OSC | |
DEANs LIST | POS |
THE TIDE | POS |
Index | Signal | Signal Date |
---|---|---|
DOW | POS | 05 Sep 2019 |
NASDAQ | NEU | 06 Sep 2019 |
GOLD | NEU | 11 Sep 2019 |
U.S. DOLLAR | POS | 29 Aug 2019 |
BONDS | NEU | 10 Sep 2019 |
CRUDE OIL | NEU | 04 Sep 2019 |
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
FAQ
All of the commentary expressed in this site and any attachments are opinions of the author, subject to change, and provided for educational purposes only. Nothing in this commentary or any attachments should be considered as trading advice. Trading any financial instrument is RISKY and may result in loss of capital including loss of principal. Past performance is not indicative of future results. Always understand the RISK before you trade.
Category: Professor's Comments