Market Direction and Stock Trends

[DiscoverGold]

Russell 3000 (RUA) Index Cash Summary Analysis
By: Marty Armstrong | December 10, 2017

Analysis for the Week of December 11, 2017

As of the close of Fri. Dec. 8, 2017: The market is in a bullish posture near-term suggesting it is positive on a daily level, but it is still trading below the December 2016 high. Projected technical Resistance stands tomorrow at 157004 and 156938. Opening above this area will cause it to become support. Projected technical Support tomorrow lies at 156303 and 156303. Naturally, opening below this area will cause it to become resistance.

We should see a trend change come January 2018 in Russel 3000 Index Cash so pay attention to events ahead. Last month produced a high at 157508 and so far we are trading neutral within last month's trading range of 157508 to 151210. We need to breakout of this range to confirm the direction. Therefore, a close above will be bullish and a close below will warn of a possible decline.

Russel 3000 Index Cash closed today at 156936 and is trading up about 17% for the year from last year's closing of 133172. So far, we have been trading up for the past 2 days since the reaction low made on Wed. Dec. 6, 2017.

Our Daily level momentum and trend indicators are both bullish 158037. Turning to the broader picture, our long-term trend and cyclical strength indicators are both bullish 156356

On the weekly level, the last important high was established the week of December 4th at 158037, which was up 15 weeks from the low made back during the week of August 21st. We have been generally trading up since that low, which has been a move of 4.51% percent in a stark panic type advance. The broader perspective, this current rally into the week of December 4th has exceeded the previous high of 153754 made back during the week of November 6th. We have seen a rally so far from the last low at 142662 made the week of August 21st, and only a break of that low would signal a technical reversal of fortune. Otherwise, the market remains strong at this time. Right now, the market is above momentum on our weekly models hinting this is still bullish for now as well as trend, long-term trend, and cyclical strength. Looking at this from a wider perspective, this market has been trading up for the past 13 weeks overall. Interestingly, the Russel 3000 Index Cash has been in a bullish phase for the past 17 months since the low established back in June 2016.

Critical support still underlies this market at 142596 and a break of that level on a monthly closing basis would warn of a decline ahead becomes possible.

Methodically, my broader-term expectation recognizes that the current directional movement since the low made back in February 2016 has been a long-term Bullish trend in Russel 3000 Index Cash. This trend remain in motion as long as we hold above 122162 on a monthly closing basis. It is incredibly important to identify the broader trend for that is the underlying tone. It is wise to take position counter-trend only with this understanding of what you are doing.

Consequently, this has been a 1 year rally in motion since 2016. Caution is advisable since this is also 8 years up from the low of given that was the major low 2009. We must pay attention to the closing for this year. If we close lower at year end, beneath 133172, then we can see a pause in the uptrend into next year. Penetrating intraday last year's low of 105645 will confirm a serious correction into next year. However, we have rallied to exceed last year's high last month. We need to see a closing above 135441 at year-end to see a continued rally is possible into next year. Exceeding this year's high next year and holding last year's low intraday will signal the bullish trend is still intact. A breach of last year's low of 105645 intraday will negate that outcome.

Addressing the longer term yearly level, we see turning points where highs or lows on an intraday or closing basis should form will be, 2018, 2020, 2023, 2025. We show a potential for a decline moving into 2018 with the opposite trend thereafter into 2020. This pattern becomes a possibility if last year's low of 105645 is penetrated even intraday. Aiming on the volatility models suggest we should see a rise in price movement during January 2020. We look to the turning points to ascertain the direction. Volatility targets reflect only volatility.

Directing our attention to the immediate momentum is Bullish on the weekly level yet we did penetrate the week of November 27th's low. This is warning to pay attention since last month had closed higher so the upward momentum is weak on the monthly level. To date, the market has exceeded last year's high of 135441. In order to maintain an upward advance, we need to close above last year's high at year end. On the weekly level, last month was an outside reversal to the upside which is implying we have a bullish bias currently. Currently, this market remains in an uptrend posture on all our indicators looking at the weekly level. We see here the trend has been moving up for the past 57 weeks. The last weekly level low was 122995, which formed during the week of October 31st. The last high on the weekly level was 158037, which was created during the week of December 4th. On a broader perspective, this market remains in an uptrend posture on all our indicators looking at the monthly level. We see here the trend has been moving up for the past 21 months. The last monthly level low was 105645, which formed during February 2016. The last high on the monthly level was 157508, which was created during November. We have generated a buy signal so some caution is required.

• DiscoverGold