SPX, COMPQ, TLT: Powell's Well That Ends... Well?

The Fed did its thing yesterday and cut interest rates by another 25 bps.  Jerome Powell then did his press conference, and his eyes burned with defiance as he angrily stated that he wants everyone (and he means everyone) to know that he can't be fired, no matter what he does:

Powell then flipped off the press corps, spit on the stage, and broke into a seemingly impromptu and horribly off-key rendition of Frank Sinatra's "My Way."  Before leaving, he announced that the next press conference would be held underwater.  In Antarctica.  

That was good enough for the market, which continued rallying as it has since the election results were announced.  SPX managed to reach and exceed its next target:

I really don't know how much more upside remains in SPX, if any, but IF it continues to push past its target zone, then I'll continue to watch that crazy extended fifth target from March.  Anything seems possible right now, with the market behaving a bit crazy itself, but I'm also watching for any impulsive declines that might put a damper on things. 

COMPQ is still around, but there's nothing to add to the prior update (except it did confirm the b-wave high):

Finally, this seemed like a good time to update the long-running TLT chart.  I think I've been using this same chart for around a decade, though the very old annotations had to be booted along the way to make room for new annotations:

In conclusion, SPX reached its next target, so we'll see if it takes a breather or not.  TLT doesn't seem interested in Powell's rate cuts, and the Fed probably doesn't want to lose complete control of long-term interest rates, as a sustained decoupling could spell trouble for multiple asset classes and for the national debt.

The market assumes Trump will be good for the economy, but the question in my mind is whether that will be enough.  America has created quite a few problems for itself, such as the problem that much of the "positive GDP growth" we had over the past few years was funded in large part by government debt, further contributing to the ever-expanding wall of debt we're now facing.  Add to that the fact that the Fed may, sooner or later, again need to start "monetizing" that debt.  And if interest rates don't play along with the Fed's cuts, then the interest on the national debt will continue to skyrocket, and problems will multiply.  Anyway, I'm not sure a good economy can take root in this bloated environment without a reckoning first.  But there are just too many undefined variables right now to determine that with much confidence.  Trade safe.

SPX and COMPQ: They Didn't Make That One Easy

Last update noted that, though my faith had been shaken, I was still very slightly leaning toward another wave up.  As of this moment, the futures market is indicating a big gap up at the open (still 5+ hours to go, so that could change of course); since that matches my lean, I'll presume we get new highs one way or another.  Assuming those new highs occur, that will suggest two possible rally outcomes, discussed on the second chart below (COMPQ).

SPX first, though.  If SPX can sustain a breakout, it would still imply a trip 5940-70, as discussed on Oct. 28:

Next is COMPQ, which lays out the options, including a more-bullish potential pattern, simply because it can't be ruled out yet:

In conclusion, it appears the market will finally get another wave up.  We have some initial target zones to watch, assuming that happens, and a line in COMPQ that might suggest a longer bullish run.  Trade safe.

SPX, COMPQ, INDU, NYA: Careful Out There

Last update noted that bulls had been put on notice, today's update will go into more detail on the potential patterns.  I was having weird intermittent internet issues this morning, which cost me a couple charts, so today's update will be short on words, and we'll let the chart annotations do the talking.

Let's start with SPX:

Next up is COMPQ:

INDU:

And finally, NYA:

In conclusion, as we've known for a while, the market is potentially into the final fifth wave up from the 2022 lows, so it's a tricky position for bulls.  Thus far, we have no confirmation of an impulsive turn, so whether or not that was "it" for the bull market or not remains to be seen.  Given the pattern in the charts at this exact moment, I'd probably still rather see another wave up, but it's maybe 50.5/49.5 at this point, so a larger decline would not come as a surprise at all.  And against the possibility that the bull market is over, we don't want to get caught trying to pick up nickels in front of a freight train.  I'm far more certain that "the top is closer than the bottom," so be careful out there and trade safe.

COMPQ and INDU: Bulls Put on Notice

In Monday's update, I wrote:

If it breaks down before then, then there are still options for that decline to be a C-wave, but we'll have to start watching things more carefully, because, as we know (and as illustrated on the NYA chart), we are likely into a larger fifth wave. And my old personal adage is, "Never bank on fifth waves." For now, we'll continue to presume there are still higher prices out there, but I did want to illustrate that it's not a great place for complacency.

The market is now in the process of attempting a breakdown, so we do need to start watching things more carefully.  INDU is still three waves down, so it's not time for bulls to panic just yet, but the chart discusses some of the options in the event that the current decline goes on to become impulsive:

 COMPQ moved a bit higher, then reversed:

SPX invalidated its proposed triangle, but I'll present a more detailed chart on Monday.

In conclusion, we've known for a while that we were in the ballpark that a fifth wave could complete, so while it would still be nice to see one more wave up, the likelihood of that wave may be more deeply called into question if this decline becomes impulsive.  Trade safe.

SPX Update (-ish)

The market was closed the past two sessions, at least in spirit.  It went nowhere, though apparently it was open, technically speaking.

Accordingly, there's really not much to add, except to note that if this is indeed the triangle I speculated about in Monday's update, the last two sessions are what you'd expect to see.

Do be aware that there's one wacky way to count this that would have the abcd all done on the triangle and just e remaining before a breakout.  Lower probability but not impossible.  Below 5800 would take that off the table.

In conclusion, there's no real reason to update any charts at all, given the last two sessions, but I updated the SPX chart anyway.  Since nothing happened, there's nothing to add, and please refer back to the prior update for more details if needed.  Trade safe.

SPX, COMPQ, NYA, INDU: Interesting Times

I'm going to mainly let the charts do the talking today.  Let's start with COMPQ, which finally broke above its red resistance line.  For a minute, anyway.

Next is NYA, mainly to illustrate why things are getting a little more interesting now:

Next is INDU, whose near-term outlook is the same:

Finally, SPX, with one potential outlined:

In conclusion, in my perfect world, SPX would go on to form a triangle fourth wave here, launch out, hit its target, and reverse.  If it breaks down before then, then there are still options for that decline to be a C-wave, but we'll have to start watching things more carefully, because, as we know (and as illustrated on the NYA chart), we are likely into a larger fifth wave.  And my old personal adage is, "Never bank on fifth waves."  For now, we'll continue to presume there are still higher prices out there, but I did want to illustrate that it's not a great place for complacency.  Trade safe.

INDU and COMPQ Updates

Since last update, the market declined slightly, but still not a ton to add to the last few weeks of updates.

COMPQ dropped down to its support line, which has held so far:

INDU fell back through blue for the moment, but is holding the black channel:

In conclusion, as noted for weeks, there's probably still at least one more 4/5 unwind needed to new highs, so we may have just seen (or still be within) that fourth wave, with five up to new highs still to come.  After that, things will start to get a little trickier again.  Of course, if there are breakdowns before then, then either a deeper fourth wave is unfolding or something more bearish -- but we'll worry about that if it becomes necessary.  Trade safe.