Market Observations for the Coming Week: The SPX made a high on 3/1 between the intense 2/27-2/28 New Moon/solar eclipse turn window and the potent 3/3-3/6 geo-cosmic and we have now declined in an EW 5-wave pattern on the hourly for the ES - this is the QUIETEST EW 5-waves on the hourly that I've ever seen ... DANGER AHEAD ?
3/07/17 (Commentary for Tuesday) Did the SPX make an exhaustion gap on 3/1 and an intermediate top? The ES made an EW 5-wave decline into late Friday and we started the next impulse leg down early Tuesday - we have a minimum EW a-b-c symmetry target of ES 2348 and we should get this on Wednesday. The VIX actually declined today along with the SPX - people are not hedging with "put options" - this is a QUIET and COMPLACENT market. The release of the Republican health care proposal to replace Obama Care may stir up some market jitters for health care stocks on Wednesday. We have seen warning signs of an intermediate stock market top: the much hyped SNAP IPO launched Thursday and the dramatic cut in trading commissions by Schwab, Fidelity and TD Ameritrade. The $VIX may be coiling for a break higher on Wednesday. Our tactic now is to hold some IWM and QQQ puts and some UVXY calls going into Wednesday with the idea that we may catch the Wave 3 of a C-Wave down. The market is close to giving us sell signals on our $TICK indicator - a decisive break of the "zero line" on the 15-period simple moving average on the hourly $TICK. Both bonds and gold appear to need more down going into next week's FOMC rate hike decision - we are expecting an important low in the PM sector next week. We still plan to buy dips in oil stocks and biotech shares on any downside volatility this week. The Dollar Index should take out 102.27 by next week's rate hike.
- Big Picture on Stocks (UPDATED) - We may have seen an important intermediate top on the SPX on 3/1 - we will watch trade very closely on Wednesday for a possible Wave 3 of C down.
- Big Picture on PMs (UPDATED) - The GDX made a high on the 21-day Fibonacci step out from 2/8 on Wednesday and we're seeing another leg down. We're looking for an important low in the 3/14-3/15 turn window which includes the 34-day Fibonacci step out from 2/08, the Full Moon Timing Window, and a potential FOMC rate hike.
- Stocks - The ES gave us an EW 5-waves down on the hourly into late Friday and may start a Wave 3 of C down early Wednesday - we're holding QQQ and IWM puts and UVXY calls.
- Gold - Gold may make a short-term low by Friday, but we're focused on the 3/14-3/15 turn window for an intermediate low in the PM sector.
- Silver – Silver is close to finishing an EW 5-waves down on the hourly chart - maybe by Friday.
- Crude Oil - The oil sector is at a crossroads - we have positive seasonality but the oil stocks must lead us higher.
- Bonds - US bonds are impulsing down - we may see a trading low on the 3/15 FOMC rate hike.
- Dollar Index – The Dollar Index should take out 102.27 after the 3/15 FOMC rate hike decision.
TURNING POINT DAY
The turn windows for this week are 3/3-3/6 and 3/10 (the NFP jobs report).