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A time to push higher

Posted by Dan on September 30, 2013

Stock markets are consolidating recent gains and remain near their highs for the year.
With another week of lunar green period to go, this is the time to push higher if the market is inclined to do so.

The situation is quite clear on the Nasdaq chart (click for larger image):

S&P 500

The market has come through the dreaded September month in a better shape than I expected, but sometimes the nastiness waits for October, so we have to remain careful.
The Nasdaq has consolidated near the upper trendline at 3800, and if it is to break out on the upside then I think it has to happen in the next week or so.
Technically my Earl2 indicator remains positive, while the shorter term Earl has come down to a level from where another push higher can start. But we still need to see the Earl turn up, and that will take one or two days with strong upside action, pushing the Nasdaq well above 3800.

If that doesn’t happen, the picture will deteriorate significantly, and then we are probably at the start of a broader correction, maybe even a bear market phase.
So, early October is going to be rather important.

Stay tuned,
Danny

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2 Responses to “A time to push higher”

  1. KR said

    Hi Danny Would you please post an update on Earl1 indicator today?

    • Danny said

      Hi KR,

      Thanks for asking. Just back from a month in Greece, so haven’t been able to write and respond to comments in the normal fashion.
      The Nasdaq tried to push higher earlier this week, and it looked like the Earl was turning up with it , but yesterday’s drop is turning the Earl down again. Other market indices have been noticeably weaker, so it’s still a market that can go either way in the short term.

      We will consider the different scenarios in my next Monday post.

      Danny

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