Weekend Stock Market Outlook

Stock Market Outlook For The Week of
August 12th = Uptrend


20/50 Day Moving Averages: Uptrend
Price & Volume Action: Uptrend
Objective Elliott Wave Analysis: Uptrend


I was a bit early in my "earnings season is winding down" comment; must have been looking at the wrong week again. Not that earnings mattered...a trade war with Turkey and a falling Lira drove our downside move last week.

All the indexes start this week above their 50 day, and only the NYSE is below it's 20.

Price charts for $SPX,$COMPQ,$INDU,$NYA,$RUT,$VIX,$TNX,$USD,$CRB,$GOLD

2018-08-12 - US Stock Market Averages

Most of the indexes also picked up two distribution days (Thursday/Friday). Since the overall trading volume was so low, it's hard to make the case that institutional selling is picked up. It's definitely something to watch...August is notoriously bad for U.S. equities, and the trading environment seems too quiet considering all the macro factors that are currently in flux (tariffs, currency, QE/QT, etc.).

Objective Elliott Wave remains in uptrend mode, but there's an expectation that the S&P will test support in the 2790's in the next week or two (coincidentally, that's roughly the 50-day moving average, and just a few points above the 2780 support level from March/June)

2018-08-12 - $SPX Technical Analysis - Daily

2018-08-12 - SPX Technical Analysis - Daily

The S&P ($SPX) remains firmly entrenched the rising channel we've been tracking. Last week, prices tested the upper trendline. And again, they headed lower afterwards.

The ADX continues to show a weak trend, but a slope change and a DI- indicator spike shows what little trend we have is bearish. The chart reminds me of price action / ADX readings from mid-June...just before the S&P fell to the lower trendline of the price channel.

2018-08-12 - $SPX Technical Analysis - Weekly

2018-08-12 - SPX Technical Analysis - Weekly

Overall, most signs point to a positive environment for investing and trading in U.S. equities, but the lack of trading volume and recent spike in volatility is something to watch. The ADX appears to align with OEWs call for some price drops over the next week or two, but that should be a BTD opportunity.

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For the detailed Elliott Wave Analysis, go to the ELLIOTT WAVE lives on by Tony Caldaro.  Charts provided courtesy of stockcharts.com.