Saturday, March 25, 2017

Market On The Razor's Edge

SGS  Market Timer Status:  LONG 
LONG as of close of November 11, 2016
SGS is a Long-Term (weeks to months) Timer

SGS ticked lower for the week, signaling more selling head.  It seems, however, that everything including financial markets, is sitting on the razor's edge and could easily fall on one side or the other.

If Trump's Russiagate starts to snowball, then we should see SGS cross its zero line and turn "SHORT". In that case, a good chunk (7% to 10%) of fluff would come out of major indices.

Short-Term (days to weeks) Outlook

SPX broke out of its narrow trading range to the downside last week.  Shorter term, chances are good that selling picks up momentum this coming week and SPX tests its 50 D-SMA around 2330 and possibly its Old-ADL around 2300 to 2260 depending on how aggressive selling becomes. 

Long-Term (weeks to months) Outlook

If Russiagate develops legs, then chances are hight that SPX sells off to test its PUL-2 around 2230 and possibly its 50 W-SMA around 2200. 

My Plan

No change since last week, I am going to follow SGS and start buying SPY if SGS starts to uptick and closes above its DTL. If SGS continues lower and crosses its zero line and turns "SHORT", I would start opening short positions in SPX by buying SH.

SPX: S&P 500 Index    D-SMA: Daily - Simple Moving Average
DJI: Dow Jones Industrial Index    D-EMA: Daily - Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ADL: Active Downtrend Line
OEX: S&P 100 Index    AUL: Active Uptrend Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.