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Thursday, April 27, 2017

Market Update 4/27/2017 Rally continues

Short term trend remains up.

Wave 3 continued faster and further than expected, which is typical for wave 3, but we saw the beginning of a little pullback into wave 4 yesterday.

Until you see a pattern develop you're guessing, but flat to down points to wave 4, often trading into a triangle, and that's what I'm seeing develop on the 1 min chart. This is a consolidation pattern, not something you sell. The only reason we're watching a 1 min chart is to break the monotony, and see what develops, and because the short term charts are working again.

Never sell a dull market applies here, and the next short squeeze is bound to take place going into the Memorial Day weekend, unless we see a (less likely) mad rush for the exits... doubtful. MM's didn't drive the market up like this in order to sell a week later. All I can say is "be patient".  

$SPX If the 1 min chart is correct, watch for traders to get shaken out on both sides of the trade today.

$SPX 5 min chart looks even more bullish, but I think this upturned channel is too aggressive. Guess we'll find out today... Key support looks like 2380. If the market breaks out to new all time highs, we'll find resistance at the end of wave 5, and see the $VIX spiking on the reversal. So far we haven't seen anything like that, so you gotta trade the market you have. The $VIX is severely oversold in the short term, and remains pinned. It's not natural, so I think it's rigged, and that could continue... when Bernanke bragged to the congress, that "volatility is down", I knew they were rigging it. Eventually they'll pull the plug on this bull market, but only when they're good and ready.  

Upside target looks like 2400+ but could go much higher is this is only wave iii of 3. One the rules you'll find in my free Elliott Wave tutorial is "never under-estimate the power of a wave 3". Easier said than done, but if you're already short with the $VIX pinned, and the trend is still up, you're not trading, you're betting on a hunch (emotions), which are going to be wrong 90% of the time.  

If you're following me on Twitter, and you have no experience trading, instead of asking me what I think the next move is, why not try trusting the charts? If you can't read a chart, at least learn the basics.  I'm not here to hold traders hands, or on Twitter to chit chat. Well, sometimes... but not usually, and especially not when I'm charting. Try to keep comments and questions to a minimum, or I'll be forced to mute you.

Oil - continues to try to build a base. Last I checked it was retesting the (WTI) $49 level, but as long as it remains off the recent lows I'm very bullish.

$BKX - Financials and Banks are looking toppy, but if the $BKX get's back above the 50 day ma, it's going to hold up for a while longer.  

Semiconductors and Tech could lead the way down, so I'd at least be headed with some short positions there. Maybe tech holds up for 3 more weeks, maybe not. I don't predict timelines.

This morning Deutsche Bank $DB is in focus, and looks like it's ready to pull back. If you remember I called the bottom on $DB in late 2016, and I believe that bottom will hold.

The rest of the targets including the Miners, and the $RUT, I've already tweeted numerous times, but I can only focus on so many things at once.

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