As always, the talking heads jump all over the market to predict major highs and the inevitable collapse/ The sharp selloff in US high-growth technology and biotech shares led the way and now they are talking about more than a minor pullback when earnings pick up speed next week. The 1st-quarter earnings estimates have fallen sharply as many companies have blamed the gut-freezing winter for weak outlooks. Look at it this way – thank God there is global warming – can you imagine what the winter would have been without it?
The high-valuation stocks came under pressure and people still try to assess this market from the exclusive domestic perspective of earnings. They remain clueless regarding the global trend and capital flow analysis.
We closed on Friday at 1815.69 on the cash S&P500 and this was BELOW the first Weekly Bearish Reversal. However, the most amazing thing has developed. The FIRST Weekly Bullish is now at 1824.00 and then 1841.00. The past week was the Panic Cycle. We elected the Daily Bearish at 1841 on Thursday and that justified the Friday meltdown.
Here is the Array we displayed at the Conference. We now have two areas of overhead resistance forming at 1865-1874 followed by 1882-1886. The Daily Bearish Reversals are now at 1809, 1772, and 1742. Our weekly support now begins at 1772 and 1736. The FIRST Monthly Bearish lies at 1746 so this is the real key area to watch.
The decline came into the Break-Line support. We have support just slightly beneath Friday’s low.
We are showing choppy markets next week with volatility rising latter into the week and the following week.
