Traders' Library Blog

Stocata S&P 500 Analysis: April 29, 2017.

Last week I wrote: "It looks like we are completing a convergent move with lower index tops and a lower Stochastic RSI top. This means that the pullback of the past week is rather a correction and that the down move will continue now. The index reached the resistance of the PP pivot level of the month, the 50-day moving average resistance and previous price support and resistance. Ready to turn down continuing the down move. The first target remains as mentioned already a couple of weeks ago 2300. This is below the last low with the size of the first leg down from the top (red arrow), the 61.8% Fibonacci retrace, the low side of the volatility band and the 100-day moving average. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

After the first round French presidential elections it looks like most people believe Marine Le Pen will not win the second round to become the new French president. But remember few believed that the English would vote for a Brexit. The up move the past week was clearly a reaction to the result of the first round French Presidential elections. I advice to close or cover long positions because, Marine Le pen winning unexpectedly the election next week Sunday, may send a big shock through the markets! Worse than the Brexit! Business will not be as usual until after this election. It looks like it has not much sense to try to predict how the markets will look May 8, 2017 this moment in time. Pure technically I would expect that gaps will be filled with a downward move the coming week(s). The new downward target is now at 2317, close to the last bottom, the low side of the volatility band and the 50% retrace. Who knows, the direction of the normal technical move expected may be a sign what to expect May 8! Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort http://stocata.org/

Stocata S&P 500 Analysis: April 22, 2017.

Last week I wrote: "In my last week comment I wrote: "Now we see a divergent move with lower tops in the index and higher tops in the Stochastic RSI. This points in the direction of a further down move below the previous low. The second zigzag down target for the coming couple of weeks is around 2300. This is the size of the first zigzag down from the top of the past week (the red arrow line down) and the 61.8% Fibonacci retrace of the last wave up." The further down move is confirmed, now reaching a low of 2328.95. The index reaches support from the previous low price, the S1 pivot support of the month and the 50% retrace level over the last up wave. Meaning we should expect some pullback. This will create the second smaller leg of the larger double zigzag down. The target remains as mentioned last week 2300. I assume it will take two more weeks to get there. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

It looks like we are completing a convergent move with lower index tops and a lower Stochastic RSI top. This means that the pullback of the past week is rather a correction and that the down move will continue now. The index reached the resistance of the PP pivot level of the month, the 50-day moving average resistance and previous price support and resistance. Ready to turn down continuing the down move. The first target remains as mentioned already a couple of weeks ago 2300. This is below the last low with the size of the first leg down from the top (red arrow), the 61.8% Fibonacci retrace, the low side of the volatility band and the 100-day moving average. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort   http://stocata.org/

Stocata S&P 500 Analysis: April 15, 2017.

Last week I wrote: "Most probably the intermediate up moving correction wave after the first zigzag has finished on Wednesday and the second zigzag down of the double down zigzag has started. Basically we should see a confirmation at the beginning of the week. The first zigzag made a convergent move with lower index prices and lower tops in the Stochastic RSI. So, I expected the up move after the first zigzag to be a correction wave only. Now we see a divergent move with lower tops in the index and higher tops in the Stochastic RSI. This points in the direction of a further down move below the previous low. The second zigzag down target for the coming couple of weeks is around 2300. This is the size of the first zigzag down from the top of the past week (the red arrow line down) and the 61.8% Fibonacci retrace of the last wave up. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

In my last week comment I wrote: "Now we see a divergent move with lower tops in the index and higher tops in the Stochastic RSI. This points in the direction of a further down move below the previous low. The second zigzag down target for the coming couple of weeks is around 2300. This is the size of the first zigzag down from the top of the past week (the red arrow line down) and the 61.8% Fibonacci retrace of the last wave up." The further down move is confirmed, now reaching a low of 2328.95. The index reaches support from the previous low price, the S1 pivot support of the month and the 50% retrace level over the last up wave. Meaning we should expect some pullback. This will create the second smaller leg of the larger double zigzag down. The target remains as mentioned last week 2300. I assume it will take two more weeks to get there. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort http://stocata.org/

Stocata S&P 500 Analysis: April 8, 2017.

Last week I wrote: "Last week I mentioned: "I expect a pullback to the upper side of the BBS band before the start of a second zigzag correction down." Monday started with a move down to the low side of the volatility band and the 50% retrace of the of the last wave up. Ending the week as expected against the resistance of the BBS band. This is a 50% pullback of the downward zigzag. There is now a fair chance that the index starts a second zigzag down. The down target for this is the 100 day average and price support around 2290.However keep in mind that this scenario becomes doubtful if the index moves above 2375. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view."

Most probably the intermediate up moving correction wave after the first zigzag has finished on Wednesday and the second zigzag down of the double down zigzag has started. Basically we should see a confirmation at the beginning of the week. The first zigzag made a convergent move with lower index prices and lower tops in the Stochastic RSI. So, I expected the up move after the first zigzag to be a correction wave only. Now we see a divergent move with lower tops in the index and higher tops in the Stochastic RSI. This points in the direction of a further down move below the previous low. The second zigzag down target for the coming couple of weeks is around 2300. This is the size of the first zigzag down from the top of the past week (the red arrow line down) and the 61.8% Fibonacci retrace of the last wave up. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort http://stocata.org/

Stocata S&P 500 Analysis: April 1, 2017.

Last week I wrote: "As I expected with my last week comment, a down move, most probably ending a first downward zigzag correction pattern reaching the low side of the BBS band and support of the 38.2% Fibonacci retrace and the PP pivot level of the current month. Next week I expect a pullback to the upper side of the BBS band before the start of a second zigzag correction down. The next down target will be the 61.8% Fibonacci retrace around 2300. Please read my comments on the weekly chart and monthly chart  for more comments regarding the longer term view."

Last week I mentioned: "I expect a pullback to the upper side of the BBS band before the start of a second zigzag correction down." Monday started with a move down to the low side of the volatility band and the 50% retrace of the of the last wave up. Ending the week as expected against the resistance of the BBS band. This is a 50% pullback of the downward zigzag. There is now a fair chance that the index starts a second zigzag down. The down target for this is the 100 day average and price support around 2290.However keep in mind that this scenario becomes doubtful if the index moves above 2375. Please read my comments on the weekly chart and monthly chart  for more information regarding the longer term view.

Sylvain Vervoort   http://stocata.org/