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  5. Stock Market Outlook - 2021-04-04

Stock Market Outlook
For The Week Of April 4th = Uptrend

INDICATORS

    ADX Directional Indicators: Uptrend
    Price & Volume Action: Uptrend
    Elliott Wave Analysis: Uptrend

ANALYSIS

The stock market outlook shows an uptrend in place to start the week of April 4th.

Technical analysis of daily SPX prices

2021-04-04-SPX Trendline Analysis - Daily

The S&P500 ($SPX) ended the shortened trading week higher, crossing 4000 for the first time ever. The ADX finally joined the other signals in bullish territory, and 3 distribution days fell off the count.

Technical analysis of daily SPX prices

2021-03-28-SPX Elliott Wave Analysis - Daily - Primary 1

The Elliott Wave count remains the same as last week, showing the S&P in the third wave of a Minor 5.

COMMENTARY

Last week, the Biden administration unveiled the "American Jobs Plan", proposing $2+ trillion in new spending over the next 8 years, including:

  • $620 billion for transportation infrastructure (roads, bridges, transit, electric vehicles)
  • $400 billion for domestic manufacturing and workforce development
  • $400 billion for disability/elderly care programs
  • $300 billion for housing
  • $200 billion for expanded broadband and electrical grid improvements
  • $180 billion in research and development focused on clean energy

Our infrastructure could use the help for sure, so this package could do a lot of good if handled correctly (i.e. real improvements are made rather than pork barrel spending and pet projects).

The goal is to make the spending "revenue-neutral", which is another way of saying tax hikes. Right now, that would be increased corporate taxes. Not quite as high as they were prior to the Trump administrations tax cuts, and still near all time lows, but an increase either way. The last round of cuts were largely absorbed via increased dividends and share buy-backs, so it's not clear how the increases will be addressed.

Best to Your Week!



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Charts provided courtesy of stockcharts.com.

For historical Elliott Wave Analysis, go to ELLIOTT WAVE lives on by Tony Caldaro. Other interpretations can be found at: Pretzel Logic, Daneric's Elliott Waves, and 12345ABCDEWXYZ

Once a year, I review the market outlook signals as if they were a mechanical trading system, while pointing out issues and making adjustments. The goal is to give you to give you an example of how to analyze and continuously improve your own systems.

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