Over the weekend – lots of merger news came out with Time Warner and AT&T reaching a deal at $85B, TD Ameritrade buying Etrade at $4B, and Rockwell Collins buying B/E Aerospace for $6.4B.
That’s close to $100B of mergers happening over the weekend — usually a bullish sign for the market.
Combine that with the fact that the market fear of a “Trump” victory is somewhat waning — markets could be setting up for a year-end rally.
October was supposed to have some big moves — either down or to the upside. Historically, there’s a lot of movement in one direction – but instead, we’ve barely budged in either direction. There’s no clear bottom to the market. While we retested close to the prior bottom at 2107 back in our post suggesting a bottom being in, we ideally wanted a little bit lower. But the rebound from that low was strong, though the follow up in the week afterwards wasn’t that strong.
It wasn’t until today that we got stronger confirmation from at least one of the 3 major indices – the Nasdaq – that we could be heading higher. Nasdaq broker into record territory — possibly because the hottest IPO of the year is about to happen – Snapchat — or now shortened to SNAP.
Previously, I suggested the formation of a leading diagonal – that is likely to be correct. The blue portion I showed an a=C B-wave — but it turns out that B -wave was inside yet another A-B-C B-wave – so we tested a bit lower into 2122 — but from there, we rallied/consolidated through toda.
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