That was an interesting week, with most markets giving us a rather sharp pullback from fresh multi-year highs.
We have a couple more days of lunar Red period to go, but basically we are now setting up for the next Green period, which is likely to bring another push upwards.
Here is the chart for the S&P 500 index (click for larger image):
We see a nice touch of the upper ceiling at 1530, the target level we mentioned two weeks ago. And this was promptly followed by a drop to just below 1500, which was our downside target for this lunar Red period. It’s always nice when things work out that well, but the world isn’t perfect so one better enjoys it while it lasts..
Technically, the Earl2 is continuing to weaken, but the shorter Earl is bottoming and ready to turn upwards (green arrow in the chart). This suggests we are likely to get the final push upwards in early March, and then we will probably be ready for some more serious downside action.
I think the Dow Jones Industrials will print a new all time high, but the S&P 500 probably not.
The market has a habit of frustrating and confusing as many investors as it can.
The LT wave chart we posted last week did quite well, correctly indicating the drop on Wednesday and Thursday, followed by a rise on Friday. Thanks to all the readers who took the time to comment on it. It’s always nice to get some interaction.
Just want to remind you again, that the LT wave chart is a beta version of a model I am still working on. So don’t bet the bank on it working all the time. It takes more than one good week to conclude on the batting average…
Can you tell the trend of euro usd by hourly?
I don’t make hourly predictions.
It’s hard enough to do the weekly and monthly trends, and I don’t like to sit in front of a trading monitor every day.
But thanks for your question, anyway.