SPX, NYA, COMPQ: Watching the Wheels Go 'Round and 'Round

 In the last update, I wrote:

Here's what we have so far: 

1. The market has indeed encountered resistance at the resistance lines we've been watching. 
2. This is about the best bears could have hoped for at this point, but 
3. So far, the decline is not yet impulsive. 

In other words, it's everything bears could want at this stage, but thus far is not enough to definitively signal they have the ball, so "just a near-term correction" is still possible. I can't sum it up much better than that.

And this is still where we are today.  I do want to add, however, that the significance here probably can't be overstated:  Multiple markets tagged resistance, ranging from intermediate to very-long-term, in concert, and were rejected.  Bears still have their work cut out for them, but so do bulls.  If bulls cannot claim those resistance zones, then lots of people could get caught standing around gawking at "the most obvious top in the world."  So we should stay on our toes here.

NYA's action was interesting on Friday:

And COMPQ is still testing its old trend line. 

In conclusion, no change so far:  Bears have hope on this reaction to resistance, but no confirmation of anything else just yet.  Trade safe.

(Side note: If anyone is wondering where the title came from:)

SPX, NYA, COMPQ: Resistance Resists...

Here's what we have so far:

1. The market has indeed encountered resistance at the resistance lines we've been watching.
2. This is about the best bears could have hoped for at this point, but
3. So far, the decline is not yet impulsive.

In other words, it's everything bears could want at this stage, but thus far is not enough to definitively signal they have the ball, so "just a near-term correction" is still possible.  I can't sum it up much better than that.

Finally, I did want to revisit the near-term chart from earlier this week, since SPX never rallied high enough to bring the speculative option into the fore:

In conclusion, as I said at the beginning, I can't sum it up much better than I did there, so I won't repeat myself here.  Trade safe.

SPX, NYA, COMPQ, BKX: Credit "Raiding"

So the big news to hit since last update is, of course, the downgrade of the USA's credit rating, only the second time in history this has occurred (the first was in 2011).  The downgrade comes from Fitch, and my favorite snip from their report is this:

In Fitch’s view, there has been a steady deterioration in standards of governance over the last 20 years

Yeah, no kidding.  Government has gotten so bad that I went from having a rule to never bring up anything political (which I succeeded in doing for years) to feeling forced to mention certain issues (usually obliquely, but occasionally directly) in these updates on and off for the past 4 years or so.  Of course, it doesn't help that our country is now more polarized than ever and therefore EVERYTHING is perceived as political, even things that shouldn't be (in my view, issues such as free speech and creeping totalitarianism are not "political" issues, they are human rights issues, and thus we'd do better to stop viewing them through the lens of our political affiliations and instead fight for/against them with the same vigor on whichever side of the aisle we find them.  A politician who's trying to sell us totalitarian policies is no longer on "our" side, even if they still claim to be.).

Fitch also underscored the rising general government deficit, which Fitch expects will rise from 3.7% in 2022 to 6.3% of gross domestic product in 2023.

With a heavy heart, Fitch ultimately decided to downgrade the USA from AAA credit to a more appropriate rating of D.  I'm kidding of course.  They generously downgraded us to AA+.

While the market reaction to the downgrade in 2011 was short-lived, this still does come at an interesting time.  

SPX, so far, still remains below its next relevant long-term trend line:

NYA remains below its intermediate line:

BKX has tagged the "90ish" target zone several times, but has so far been unable to clear it:

And COMPQ is still lingering near its relevant long-term trend line:

In conclusion, if the market was looking for a catalyst to react to these resistance lines, then maybe the credit downgrade will provide one.  Or if it was looking for a "gotcha" rally (i.e.- negative news generates a positive market reaction), then the same thing applies.  On the downside, 4527 SPX is the first level bears need to claim and hold, on the upside, the trend lines serve the same function.  Trade safe.

SPX and NYA: Near-Term Potential

There's one near-term chart to Friday's comprehensive update -- the near-term SPX chart:

On the chart above, the ending diagonal might need two more slight new highs, while the complex flat could reverse lower directly (though would ultimately revisit these highs after visiting the 4520s or below).

Given long-term overhead resistance (chart below), the above seems like a reasonable near-term possibility, which would also accomplish the goal of being confusing to many participants.

NYA is also facing intermediate overhead resistance:

Not much to say beyond that.  Trade safe.

SPX, NYA, COMPQ, BKX, Oil: Oil's Well That Ends Well

On Wednesday, the Fed raised rates another .25%, giving us the highest interest rates in 22 years, but leading pundits to speculate that the Fed is done raising rates and will pause in September.  The market responded to the announcement like an electrocuted giraffe, lunging lower, then higher, then lower again on Thursday.

Powell, on the other hand, was reluctant to commit one way or the other, preferring to wait for the next two months of data.  And there's at least a chance that Powell might be onto something.  It's worth noting that oil was stuck in a potential basing pattern for the last couple months, at the lowest levels it's seen in the past year and a half:

NYA encountered resistance yesterday at the black trend line, which is bulls' next obvious hurdle:

BKX reached its "90ish" target, now we'll see if it can break through or not:

Still watching to see how COMPQ reacts to this back-test:

And still watching to see how SPX reacts to this 36-year-old overhead trend line:

That's about all I've got for today.  Trade safe.

SPX and COMPQ: Tyrants and Tie Rants

Today is the much-anticipated Fed Day, and many pundits have wondered whether Jerome Powell will "stay the course" and wear either his blue or purple tie, or whether he'll signal a shift in stance by wearing something new.  Since we covered all that in great detail on Monday (???), there's not much to add in that regard, however, I did add the official "bear version" of the current rally to the SPX chart:

COMPQ is now attempting its first back-test from above, which is worth keeping an eye on:

Beyond that, it's just a matter of waiting for the Fed, though Lord only knows WHY we have to play this stupid waiting game every Fed day, no matter what the announcement, but that's the way things work now.  Trade safe.

BKX, SPX: Mr. Gorbachev, Tear Down This Wall

We're coming up fast on the Fed meeting (July 25-26, casual dress okay, BYOB), so you might think there's nothing to say about this market in the meantime, and you'd be half right.  But there is one interesting chart to take a gander at nonetheless:

BKX has reached a much smaller trend line, but it's also worth a gander (though not a goose):

In conclusion, NYA managed to put the kibosh on the most immediately bearish count, but it's not like that's a complete "all clear" for bulls.  While the most "straightforward" interpretation of things is probably that the market is in a 3/C up (as I've said previously), that's not the same as saying 3/C is a slam dunk, so we'll see if the Fed causes any ripples.  Trade safe.