"No warning can save people determined to grow suddently rich" - Lord Overstone

  • 2 hours Gold Selloff Continues As Dollar Climbs Higher
  • 3 hours Gold Investors In A Frenzy Over Sunken Russian Warship
  • 4 hours The New King Of Electric Cars
  • 5 hours BlackRock Goes Bitcoin
  • 6 hours U.S. Banks See Best Earnings Report In Years
  • 8 hours The Case For Gold Is Not About Price
  • 10 hours Stock Market Sentiment Turns Bullish
  • 1 day What Is Bitcoin Really Supposed To Be?
  • 1 day The Surprising Media Giant Taking On Netflix
  • 1 day Cybersecurity Stocks Are Red-Hot As Election Looms
  • 1 day Americans Grow Weary Of U.S. Trade Policy
  • 1 day What Putin Really Wants From Trump
  • 1 day Europe’s EV Sales Growth Is Slowing
  • 1 day The Looming "Hyper-War"
  • 2 days The Real Winners Of The Real Estate Business
  • 2 days 3 Reasons Small-Cap Stocks Are Booming
  • 2 days Chinese IPO Fervor Slows As Xiaomi Disappoints
  • 2 days How Corporate America Is Filling The Gaps In Public Education
  • 2 days Bezos’ Space Flight Gamble
  • 2 days Is This The Answer To High Gasoline Prices?
The Case For Gold Is Not About Price

The Case For Gold Is Not About Price

Gold has seen huge gains…

The Biggest Winners Of Q2 Earnings Season

The Biggest Winners Of Q2 Earnings Season

The second quarter of 2018…

3 Reasons Small-Cap Stocks Are Booming

3 Reasons Small-Cap Stocks Are Booming

As major market indexes waiver,…

CNBC PowerLunch Europe


In May there was a false break top that I had forecast would complete an intermediate counter trend rally in a bear campaign. I also said if the trend were down, as I had forecast, the index would not rally past 4 days until a low was in place. You can see the rallies have been 3 days. I have been able to forecast this because this is the way markets trend. Most people now days are more interested in some complicated method of calculating a moving average than they are understanding trends and understanding trends is the "Name of this Game." When indexes are in strong trends they only rally 1 to 4 days against that trend it's that simple. I said the index would test the January/March lows. By test I mean stop marginally above or marginally below that level. The rally from that test will be 7 to 11 trading days and then run down and test the lows again. If that support holds then the index will go into a two month choppy sideways move. If it starts to trend below that support then 1180 could be the next downside objective. I am assuming the end to this current move down for the forecasted 11 day rally will be around July 3rd.

The price level for this next low is difficult I would expect the trendline drawn from lows to lows to be broken and create a capitulation low or spike low but nothing as large as the January spike. But that is not a requirement for the low. Price could be as high as 1296 (1276 is interesting) or as low as 1234. If yesterday was a low it would be bearish and the rally would only be 7 trading days and make a strong run down when completed to marginally break the March low. Looks like Midcap and small cap just rotated into highs.


Last time we looked at the DAX was 14th May and I explained in detail how the high could come in the next few days but to be careful because it could also exhaust up to as high as 7500. It only went to 7340 with a marginal break above the "OBVIOUS" resistance as I had explained on the 14th of May. Back as early as April 25th I indicated the March low would need to be broken to set up a low. The downtrend was just too strong to believe in a low that didn't come from breaking a low. I don't see any reason to change that forecast. There is a 5 wave structure down and that could indicate a complete movement down but just as with the S&P 500 I would be very leery of a low from this price level and the best might be a 7 to 11 day rally and fail. Then break the March low for a low.

A review of other forecasts: Crude could still spike up into the 30th of June for an important high but when a market is in a tight sideways pattern the third day off a low is always important since that is the normal counter trend time period. This has been such a tight, small range while in this sideways pattern a spike up would not be unusual.

The US Dollar Index was discussed on the 11th and I indicated it would not get past 13th or 16th (Friday/Monday) at the price of 74 and it hasn't. But it also hasn't been able to get any legs to the downside. The next two days that could start a move or trend are this Thursday or the 3rd of July.

If you would like to understand trends the E-BOOK offered on this site is a very good start. This is proprietary analysis and would only be found on this website.


Back to homepage

Leave a comment

Leave a comment