The S&P500 ($SPX) starts this week in familiar territory; ~3% above the 50-day moving average and ~10% above the 200-day moving average. The index is also poised to break the bullish price channel (or fall back to support if you’re bearish).
2021-08-29-SPX Trendline Analysis - Daily
The ADX flipped back to an uptrend to last Monday, and all three signals show bullish behavior right now. Price/volume has stabilized, with trading volumes below average for much of August.
Elliott Wave remains in an uptrend for now...currently a iii-wave by the looks of it. There's a negative divergence in the RSI, going back to early July, but that's more for confirmation than prediction at this point.
2021-08-29-SPX Elliott Wave Analysis - Daily - Primary 1
In late June, the iii-wave lasted 10 days; the current iii-wave is 6 days old. If past it precedence, the S&P is setting up a very interesting week of trading after the long Labor Day weekend.
Word on the street is that the U.S. Federal Reserve is done thinking, about thinking about changing their policy stance.
Right now, odds are the Fed announces said policy shift at the September meeting (21st and 22nd), with further odds placed on a December start date for "gradual" tapering of QE measures.
While there's a lot of talk about inflation, it seems the Fed is still content to think about thinking about a potential shift in short-term interest rates...probably until this time next year.
Of course, all bets are off if we have a market correction of any significance.
Best to Your Week!
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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