At medium term crossroads... market at overbought

Have been busy since my last post back in early October last year. As the chart below shows, there were two 'minor' medium term signals around Nov./Dec. and January. The stock market is still higher than my last call for a medium term rally in early October. Right now we are close to or at medium term overbought and would expect mostly weakness in the individual stocks in the coming weeks. The major indexes (Dow, SP500, Nasdaq, Nasdaq 100) could follow along with weakness too or they could continue to slowly grind higher for several more weeks before turning sharply down. Good time to start placing sell stop orders or/and shift to selling individual stocks into small positions in the major index ETFs if one decides to take the risk for more upside.

Medium term buy signal made this past week

Have not posted for a several months... busy, lazy, or just waiting for the 200 day moving average to be touched which I probably should not had concentrated too much on this summer. Because of the fear that the SP500 and the stock market will get a steep sell off toward the 200 DMAs had prevented me from being fully invested in the last medium term buy signal in early August. So I'm ignoring the 200 DMA for now this time as there is another buy signal made this past week. There could be one more retest down toward today's low in a week or two... or this could be THE bottom. Either way, coming out of October I expect the stock market to rally for the rest of the 4th quarter to new record highs in the SP500.

Got the break higher... now at medium term overbought and a record broken concerning the 200 DMA

Since the last post, the stock market shot up higher after consolidating for several weeks. The break above SP500 1900 was finally completed and the indexes had a nice week long rally. I thought the move higher could be done early last week but then on that Thursday started another move higher for three more days before pausing or pulling back slightly. So this week my indicators are now at short and medium term overbought thus this warrant caution at minimum as individual stocks could be hit with some selling before the indexes. Now comes the new record concerning the SP500 200 day moving average. Going back the past +25 years, the longest the SP500 have been above its 200 DMA without retouching it has been 18.5 months. Currently it's about a week away from 19 months and the SP500 is still +7% above the 200 DMA at 1808. Is it different this time? In Wall Street, that's a dangerous question to ask. Stock market appears resilient and the truth is we are still in a long term secular bull market. But eventually I believe the SP500 will meet the 200 DMA some where between current level of mid 1900s to the lower level of the 1850s.

At narrow trading range while waiting for the 200 DMA to catch up but main risk is still to the downside

As the title of this post states, the stock market in the last several weeks have been going in short moves up and down slowly waiting for the 200 DMA to catch up. I'm guessing the SP500 could make a sharp quick move down once the 200 DMA moves up toward the 1800-1825 level. The Dow and NYSE Composite, like the SP500, have been moving in rising trading ranges.

Unfortunately for the Nasdaq, Nasdaq 100, and Russell 2000, they have been moving in declining trading ranges. The Russell 2000 index has already touched its 200 DMA in mid April while the Nasdaq indexes came close but no cigar.

The Nasdaq and Nasdaq 100 are in a potential technical pattern whereas a break out of the trend lines will be a false one as it reversal back into the opposite direction. I anticipating this would be a false breakout higher (to go along with the SP500 making an initial break above 1900) and then a reversal back down for an eventual retouching the  200 DMA.

Struggling to stay afloat for the coming month.

From the last post I gave while I was on a spring break vacation I noted a rally was overdue due to oversold readings. Got a week long rally but then the market turned back down the last several days. The stock market is using the Ukaine crisis as an excuse for most of the selling. The real issue should be that the SP500 has now gone 17+ months since it last touched its 200 day moving average (the longest in the last 25+ years being 19 months in 1996.) So I could see some consolidation or more likely... weakness in the coming month as the SP500 is still about +5% above its 200 DMA.

At very short term oversold again

I'm on vacation right now so this post will be short. Like the last post, I'm looking for a rally here due to very oversold readings for the short term. The stock market didn't quite reach the downside target nor the upside target I was looking for in my last post and the follow-up comment. Maybe this is what I am anticipating from the last post.

Short term oversold that's setting up a strong short term rally but may need one more day of scary sell-off

From the last post I stated a short term overbought should last a few more weeks before running into a pause or consolidation. We got that in early March where individual stocks, especially speculative momentum stocks, started to sell-off. I followed up with a comment to the last post of a possible brief rally of the stock market with the SP500 rallying back toward the 1870-1880 level. Was unsure whether the SP500 would continue higher from there or would come back down. Well, from the past week the Nasdaq, Nasdaq 100, and Russell 2000 had sold off quite a bit. The other major indexes... Dow, SP500, and NY Composite had held up better. With the weakness from the last three weeks the stock market is now at short term oversold levels though not at medium term oversold yet. But I still see the stock market could drop a bit more before turning higher again. If there is further brief weakness than I'm looking at the SP500 1830-1835 level to eventually see a short term rally to develop that could eventually lead to a break above 1880 and higher. Looking ahead that could get the investors excited as the SP500 finally rallies toward 1900+ after having failed to hold at 1880 this month, March. But a rally above 1900+ could be short term lived as the SP500 and stock market should make likely break back lower with a sharp quick sell-off to eventually retouched its 200 day moving average, which by then should be moving slowly higher toward the 1800+ level.