Thursday, June 1, 2017

SPX, BKX, NYA, NDX: Mixed Signals

So the market is still giving off mixed signals, as BKX recently broke its prior swing low, while of course SPX recently made a new all-time high.  RUT has also been underperforming; whle INDU has not broken its prior ATH, nor has NYA.  These markets are going to need to get in sync if the bulls want to stretch this rally much higher, and right now one could be forgiven for thinking the rally may be close to running out of steam for at least a little while.  Let's look at a few charts.

We'll start with SPX, which found support at both of the first two noted support points (though first support then broke after a bounce):

SPX counts well as the famed "WTF" pattern, so I went looking at other markets to see if sense could be made elsewhere.  NYA could, theoretically, count as a complete ABC decline (I've labeled it below as a bullish corrective wave, in order to show how that option would be technically feasible), but it's far from conventional, so it's entirely possible this is simply a portion of an incomplete bearish decline wave. 

About a month ago, I mentioned (on the forum) that NDX looked like it would continue rallying for the foreseeable future -- but now NDX is finally getting into territory where it may be completing five waves of rally:

Meanwhile, BKX has continued to behave like a rebellious child (unsurpringly), and has thus far refused to participate in the mandated "Everything is Awesome!" program.  It's possible that BKX will be selected for "reconditioning," where it will be strapped into a chair in a room with only a single TV screen, and forced to listen to Ben Bernanke talk about the Fed's "Tools" (although he will never use any actual first OR last names to describe the "tools" at the Fed):

In conclusion, the markets are fractured and will need to get on the same page if bulls wish to continue Happy Fun Time.  As it sits now, it still looks like we're closer to a top than to a bottom.  Trade safe.

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