It’s Easter / Good Friday weekend and markets were closed on Friday. While the markets were positioned for more downside this past week – it began with a violent rally – and then erased it all the very next day – but then was stuck for the rest of the week into the long weekend.
Usually for long 3-day weekends, it’s very unlikely for a crash to happen into it. Instsead, what we saw was short covering.
So as much as I’d like to see this market retest the lows from earlier in February before a move back up – I have to give the benefit of the doubt to the bulls within this larger bull market.
The FB news has been very negative and Trump has already made comments, forcing Amazon stock down – in the immediate next week – I see the probability of this getting worse as <50%. Meanwhile, I do see a clear 5 waves down on the Nasdaq — and it seems the Nasdaq is struggling to move lower.
The Dow and S&P are weaker, but the Nasdaq looks to have completed 5 waves and may even be heading for a move up. So it’s difficult to get overly bearish here because the market just isn’t following through for that spectacular big downside I was hoping for .
At the start of this past week, I wanted to see downside follow through – especially since we closed last Friday below 2600 – yet we had all week to get down, but we spent the entire week above that 2600 level — some initial signs that the bears are dropping the ball yet again.
The Dow chart is similar to to S&P – yet this past week – it, too, stayed above the low from last Friday all week — additional signs that the Dow bears are dropping the ball.
So if the Nasdaq clue of 5 waves down is indeed accurate, I don’t see the market dropping this next week as most are anticipating
I see an A-B-1-2-3-4-5 chart – where the 5 made a lower low – while it did not in the Dow and S&P. So the Nasdaq chart seems most complete to the downside whereas the Dow and S&P potentially made truncated 5ths.
Hard to say – as it can go either way with such high levels of volatility – but I’m leaning towards a move up this net week if there is minimal movement in the futures market into the Monday open.
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