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Sunday, July 12, 2009 11:06:53 AM
Amateur Investors Weekend Stock Market Analysis (7/11/09)
http://www.amateur-investor.net/Weekend_Market_Analysis_July_11_09.htm
Both the Dow and S&P 500 are exhibiting Head and Shoulder Top patterns in the near term. In addition both broke below their Neckline support areas this week as well. The next major support area for the Dow is at its 38.2% Retrace near 7986 calculated from the early March low to the mid June high. However it may try and rally back to its Neckline (black line) near 8275 or its 50 Day EMA (blue line) around 8350 before it drops back to the 7958 level.
As far as the S&P 500 its next major support area is at 846 which is the 38.2% Retrace calculated from the early March low to the mid June. However just like the Dow it could try and rally back to its Neckline (black line) near 894 or its 50 Day EMA (blue line) near 900 before it eventually drops back to the 846 level.
Meanwhile in the longer at this point it does look like the A Wave has completed in both the Dow and S&P 500 and the correction over the past 4 weeks is the development of the B Wave. Typically a B Wave can retrace anywhere from 38.2% to 61.8% of the A Wave. The chart of the Dow shows that the 38.2% Retrace is at 7958 (blue line) while the 50% Retrace (black line) is around 7675. Meanwhile the 61.8% Retrace would be at 7390 (brown line).
As for the S&P 500 its 38.2% Retrace is at 846 (blue line) with the 50% Retrace around 812 (black line). Meanwhile the 61.8% Retrace would be at 777 (brown line).
Keep in mind the above scenario is a more bullish outlook as once the B Wave completes then this would be followed by a C Wave higher as shown in the chart below. Remember this assumes that Wave 5 ended with the March low in both the Dow and S&P 500 as I talked about last week. Also notice in this type of pattern that it takes the shape of an Inverted Head and Shoulders pattern as well.
In 2008 our ETF Strategies worked the best with which had a return of +33% versus the S&P 500 which was down -38.5% for the year.
Meanwhile our 401K Strategy finished up +17.3% for the year.
Signup for a "Free 4 Week Trial Membership" or save up to 50% on a Premium Membership and you will have access to these Investment Products which include the following:
1. "ETF Daily Buy and Short Signals" which can be used to trade the DIA's, QQQQ's, SPY's and OIH's. Our ETF Strategy returned 33% in 2008.
2. "401K/Thrift Savings Plan (TSP) Timing Service" which can be used to help improve your return in your 401k/TSP Account which was up +17.3% in 2008.
3. The "End of Month Strategy" finished up +36.3% in 2008. This Strategy focuses on the typical End of Month markup by the Institutional Money.
4. "Stocks to Buy List" which can be used with either our Short Term Strategy or Long Term Strategy. In 2007 our Long Term Strategy finished even for the year versus the S&P 500 which was down -38.5%.
Our Summer Membership Special for new Members is shown below
which are 50% Off our normal Monthly Rate of $39.95
http://www.amateur-investor.net/Weekend_Market_Analysis_July_11_09.htm
Both the Dow and S&P 500 are exhibiting Head and Shoulder Top patterns in the near term. In addition both broke below their Neckline support areas this week as well. The next major support area for the Dow is at its 38.2% Retrace near 7986 calculated from the early March low to the mid June high. However it may try and rally back to its Neckline (black line) near 8275 or its 50 Day EMA (blue line) around 8350 before it drops back to the 7958 level.
As far as the S&P 500 its next major support area is at 846 which is the 38.2% Retrace calculated from the early March low to the mid June. However just like the Dow it could try and rally back to its Neckline (black line) near 894 or its 50 Day EMA (blue line) near 900 before it eventually drops back to the 846 level.
Meanwhile in the longer at this point it does look like the A Wave has completed in both the Dow and S&P 500 and the correction over the past 4 weeks is the development of the B Wave. Typically a B Wave can retrace anywhere from 38.2% to 61.8% of the A Wave. The chart of the Dow shows that the 38.2% Retrace is at 7958 (blue line) while the 50% Retrace (black line) is around 7675. Meanwhile the 61.8% Retrace would be at 7390 (brown line).
As for the S&P 500 its 38.2% Retrace is at 846 (blue line) with the 50% Retrace around 812 (black line). Meanwhile the 61.8% Retrace would be at 777 (brown line).
Keep in mind the above scenario is a more bullish outlook as once the B Wave completes then this would be followed by a C Wave higher as shown in the chart below. Remember this assumes that Wave 5 ended with the March low in both the Dow and S&P 500 as I talked about last week. Also notice in this type of pattern that it takes the shape of an Inverted Head and Shoulders pattern as well.
In 2008 our ETF Strategies worked the best with which had a return of +33% versus the S&P 500 which was down -38.5% for the year.
Meanwhile our 401K Strategy finished up +17.3% for the year.
Signup for a "Free 4 Week Trial Membership" or save up to 50% on a Premium Membership and you will have access to these Investment Products which include the following:
1. "ETF Daily Buy and Short Signals" which can be used to trade the DIA's, QQQQ's, SPY's and OIH's. Our ETF Strategy returned 33% in 2008.
2. "401K/Thrift Savings Plan (TSP) Timing Service" which can be used to help improve your return in your 401k/TSP Account which was up +17.3% in 2008.
3. The "End of Month Strategy" finished up +36.3% in 2008. This Strategy focuses on the typical End of Month markup by the Institutional Money.
4. "Stocks to Buy List" which can be used with either our Short Term Strategy or Long Term Strategy. In 2007 our Long Term Strategy finished even for the year versus the S&P 500 which was down -38.5%.
Our Summer Membership Special for new Members is shown below
which are 50% Off our normal Monthly Rate of $39.95
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