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 ?
3/08/17 (Commentary for Wednesday) 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 could get this on Thursday. The ADP jobs reports came in very strong and bullish comments from the widely-followed money manager, David, Tepper, gave the market a positive open. 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 Thursday. 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 Thursday. Our tactic now is to hold some IWM and QQQ puts and some UVXY calls going into Thursday with the idea that we could catch the Wave 3 of a C-Wave down. The market is giving us a sell signal on our $TICK indicator - we got 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 Thursday 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 SPX may have started a wave 3 of C down with a target of 2348 - we're holding IWM puts and UVXY calls.
- Gold - Gold continues to sub-divide down bearishly - we're looking for more decline into next week's FOMC rate hike decision.
- Silver – Silver continues to sub-divide down into the 3/12-3/13 Full Moon Timing Window - we're focused on a potential low after next week's FOMC rate hike decision.
- Crude Oil - Crude oil is declining hard into the Full Moon and we're looking for a low by Monday - we're in a positive seasonality period - we're looking to buy dips in CVX, COP and SLB.
- Bonds - US bonds are impulsing down - we may see a trading low by the 3/15 FOMC rate hike decision.
- Dollar Index – We're looking for another rally leg above 102.27 into 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).