Professor’s Comments & Update 10/16/19
Posted by OMS at October 16th, 2019
| Once again, the market had an early rally followed by a late pullback…trading that is more indicative of a corrective wave than one that’s impulsive. Also, yesterday’s rally stayed below the 12 September high of 27,307, and if this high is not broken, it’s still possible that the recent rally is part of a corrective wave 2 up. If this Wave 2 scenario is taking place, the markets should begin to decline soon…. like today! If they don’t, the odds will favor a continued choppy rise taking the markets to new highs. There were NO CHANGES to the market timing indicators after yesterday’s session. The Dow, NASDAQ, SPX, and RUT remain on Buy Signals. However, students should understand that the patterns are weak at this time, so the odds for higher process are only about 60-40 at best. If the September high is exceeded, the odds for higher prices would increase significantly, but probably NOT change where the final top occurs. It still appears that the Dow will top near the 27,500-27,700 level. The Sector Ratio strengthened to 17-7 Positive after Tuesday’s session. The Strongest Sectors were Service, Semiconductors, Retail, Consumer Products, and Food Drugs. The Weakest Sectors were Leisure, Household Products, Utilities, Real Estate and Media. The Model bought 1,000 shares of TBT yesterday, based on a strong Hockey Stick pattern on the short term bars, positive indicators, and the fact that TBT has moved to the #2 spot on the Dean’s List. The of purchase of TBT is a bet that Bond prices will decline, and interest rates will increase over the next few weeks as part of a Wave 4 pullback in Bonds. 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 Update: The Model is looking to buy a ‘trial’ position (1,000 shares)of UCO, the crude oil ETF, near current prices. Crude Oil appears to be in the final stages of completing its months long triangle pattern and if so, should be ready to begin its next leg up. The purchase will be made near the current price of.15.57. h |
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