Equity Wrapup 5/31

Looking at the four equity markets (S&P, dow, nasdaq, and russell) we see that of these, only the russell actually broke a new major low peak (@813.4) in the last couple weeks, and the rest only seem to have made deep retracements. The russell is also the only one now that has firmly broken past the top level 61.8% retracement (@845) of this down move. The other three are either right at the top or still inside the major levels of the most recent move (all retracements shown in red on charts). It looks like barring a major reversal tomorrow (which is always possible), we are heading back to an uptrend in the equity market for the time being, with confirmation coming as all the markets break past 61.8% level or breaking new yearly highs. I'll go ahead and say it here that it might be time to BTFD if you haven't already.

Equities weekly wrap-up 5/27

I think since we've started this blog we have been advocating a short position in equities markets. While the last few days have not been kind after a good start to the week, I think there is strong evidence that there is nothing to panic about in all 4 markets. The retracements in yellow are the retracements of the last up move before the downtrend began, and all 4 markets broke below the lowest retracement level of these on Tuesday or Wednesday, indicating an end to the uptrend. We've also held the retracement for the most recent down move (in purple) in all 4 markets. As is the case most of the time, we leave into a long weekend with a lot of uncertainty sitting on important levels. All four markets sit at a confluence of retracements except the S&P. The Russell is the only one to break past the 38% retracement of the most recent downmove, but now sits at the 50% and also the most recent peak from last week. I think we look to continue the down swing on Tuesday, but any higher than we finished today and we might end up in a no trend area, which is always danger for swing traders.

Equities moving up, Russell 2K leading way 5/26

It looks like the major equity indexes are making a move up today, with the Russell 2000 and Nasdaq leading the way. Both are coming upon critical levels here in the early afternoon, with Russell reaching the first level of the complete downmove's retracement (@827.6) along with the trendline in purple. The nasdaq is coming upon a confluence of retracements at the 2327-2332 level. While I've been recommending short equity indexes, Todays close and tomorrow will be important. Closes over these aforementioned levels in the Nasdaq and Russell would make me probably dump what I have going into the long weekend. But we've seen this multiple times now on this downtrend in all equities as they make new lows then pullback for a couple days. Don't be shocked if we finish at these levels today and then head south on Friday into the weekend.