The Market Perspective

Oil Fails to Break Out

.Weekend Oct 2 0222

sometimes old highs become new support. This did not happen with teh Nov 2021 high. Even with the hurricane ooil fell below that level. So expect more weakness before any rally.

Meta Enters Its Bear Market

Weekend Oct 1 2022

At least one analyst wonders abut meta's core business

New Highs New Lows

Weekend Oct 1 2022

Okay so the market fell again esp the last part of the day Friday. But new highs new lows tells a different story.

The indicator managed to make a higher low indicating fewer lows than on Thursday or the extreme of Sept 26

Industrials

 

Transports

Bear markets sport long term over sold conditions. We are early in the third wave down and quite over sold on both indexes. Note they both indicate yet another Dow Theory sell signal as they both made new lows.

Interest Rates Soar as Bear Gets Underway

Weekend Oct 1 2022

3 Month T Bill Yield

T Bill yields have soared from a quarter percent to  3.25% just this year.

the two year yield is the one the FED is chasing and is has moved form .75  to 4.25$

This is happening world wide.  Emerging market debt is already in steep decline. US  debt is beyond 20 Trillion and its roll over cost will soon consume a great deal of what used to be called the Fedderal Budget.

Teh Case Shiller Home Index is just now topping despite sales already sagging.

the long term chart fomr the sub prime low  is finishing in typical parabolic fashion.

Philadelpphia JHousing  Index first peaked with emerging markets in earlyu 2021. It made its final top along with US stock indexes in December 2020, and now is falling fast.

 

 

 

Former high fliers are falling to earth, here is Facebook now re branded Meta

Major Indexes

Weekend Sept 30 2022

Dow Industrials

Dow Transports

Apple Tells the Story

Friday After Market Close Sept 30 2022

As noted in my column everyone owns Apple. It is included in many ETFs and Indexes.The big picture is that Apple topped along with the DJIA in very early Janary 2022 at  180. Wave one took it down to 130  in June. Wave Two peaked in August at 175, below the January peak. Now a Wave three has begun.

Wave Three down will be much larger than Wave One.Here is a close up. Wave One down was 50 points. Wave three will be much more than that.

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Bear Market Rallies

Wed sept 28 2022

I do believe this bear market rally which ended yesterday or today on the open has legs to run into mid Oct. but this article reminds us the market will stair step down all the way to the bottom.

 

Bear Market Rallies: Here's a Key Insight
How investors get snookered into the belief of "a further market advance"

By Elliott Wave International

Nothing raises the hopes of the bullishly inclined like a rapid bear market rally. And there's been several since the early January top in the Dow Industrials and S&P 500 index.

You may be interested in a key characteristic of most of these rallies.

The Sept. 12 U.S. Short Term Update, a thrice weekly Elliott Wave International publication which provides near-term analysis of major U.S. financial markets, explains with this chart and commentary:

Sometimes the upward push will end at or near top tick of the daily range. A quick glance at the countertrend rallies since the January peak in the S&P shows at least five instances of this happening, indicated by the red arrows on the chart. The final trade of these daily ranges was at or very near the high of the day, creating belief in a further market advance when in fact it was the top of the rally.

Keep in mind that "not every strong up day that closes at top tick marks the end of the rally but the end of the rally is often attended by strong up days that close at top tick."

That said, here are just a couple of examples in recent months of the lingering optimism:

• Why There's a Chance the Stock Market Has Hit Bottom (Barron's, July 19)
• Top Investment Ideas for a Market That Might Have Hit Bottom (Bloomberg, Aug. 4)

In other words, memories of the prior bull market die hard, even several months after the S&P 500's record high near the start of the year.

And, regarding those July and August headlines about a market bottom, that didn't turn out to be the case. Here's a Sept. 16 headline (CNBC):

FedEx plunge could spell bad days ahead for market as bellwether Dow Transports index hits new low

The question is: Will other indexes -- like the S&P 500 and Dow Industrials -- also plunge to new lows?

Now is the time to familiarize yourself with the U.S. stock market's Elliott wave pattern.

If you're new to Elliott wave analysis or need a refresher, do know that the definitive text on the topic is Frost & Prechter's book, Elliott Wave Principle: Key to Market Behavior. Here's a quote from this Wall Street classic:

Without Elliott, there appear to be an infinite number of possibilities for market action. What the Wave Principle provides is a means of first limiting the possibilities and then ordering the relative probabilities of possible future market paths. Elliott's highly specific rules reduce the number of valid alternatives to a minimum. Among those, the best interpretation, sometimes called the "preferred count," is the one that satisfies the largest number of guidelines.

If you'd like to read the entire online version of Elliott Wave Principle: Key to Market Behavior, you may do so for free after you join Club EWI, the world's largest Elliott wave educational community (about 500,000 worldwide members and growing rapidly).

A Club EWI membership is free and allows you free access to a wealth of Elliott wave resources on financial markets, investing and trading without any obligation. Those resources include exclusive videos and articles from Elliott Wave International's analysts.

Just follow the link, and you'll be on your way to becoming a Club EWI member: Elliott Wave Principle: Key to Market Behavior -- get instant and free access now.

This article was syndicated by Elliott Wave International and was originally published under the headline Bear Market Rallies: Here's a Key Insight. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

 

Short term Low in the Making

Wed Sept  28 2022

Looks like our call to buy yesterday was correct. The DJIA was down  250 on Globex earlier this morning and has now turned positive.Oil and Gold are positive. Silver is off a nickel, as said yesterday the market is attempting to find a bottom.

Expect this fourth wave to last into Mid October before downtrend resumes.

And the ten year Treasury hit  4% yesterday.

.Market Trying to Bottom

Tuesday Sept 27 2022

/transports lead and that is the best looking of the three charts.Money flow came back for each of the three. Let's be patient Transorts closed up 1.29%.

Crude Oil and gold also closed up. So all of these fell together and we are seeing some bounce .Again look at the list of new lows in the WSJ today, that's a low.

Relief Rally

Tuesday Sept 27 2022

Stocks have declined nine of the last ten days. The new low list in the WSJ runs more columns than I bothered to count.  This looks like the start of a fourth wave up.

Wave 2 was sideways so this is liable to be a much stronger rebound to the upside. But this willl not change the overall direction of the mrkets.

As all asset classes have fallen together, will they now reverse and rise together into Mid October?  Let's especially watch bond prices and interest rates today.