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Last Sunday I indicated the NDX could see a low of
1482 and the S&P 500 a low of 1186 before a reversal occurred. On Friday we
saw both of these lows and slightly more setting up the possible up swing for
this coming week. All major indexes are in a reversal condition for tomorrow and
the individual stocks show a strong bullish bias. In addition Monday is the
beginning day of a four day cycle and so it is an important day for the
trend for the rest of the week. If we see a weak rally attempt and a lower
close, it would be very bearish. If we see a strong close, chances are the up
swing will continue for the rest of the week.
Of course all of this is assuming no new strong
impulses to the markets. Let's see how it develops.
Jim White
----- Original Message -----
Sent: Sunday, March 13, 2005 5:09
AM
Subject: [RT] Next Week
Each week I analyze all the stocks in the DJIA and NDX 100
as well as the
major stock indexes, sector ETF's, current markets, bond and
T-Bill markets.
The analysis gives me a perspective of what to expect in
the coming week,
when to expect significant reversals and what sectors of
the market will be
the best trading vehicles for the week. The methodology
has proven it's
worth over the years providing an 80% win/loss ratio and
ROI's far above the
norm. For the coming week I see some tradable
cross-currents emerging.
First, my longer term market models are signaling
a reduction in the risk of
a substantial decline which I first warned about
several weeks ago. The
composite market model first warned of a decline on
1/10 and reversed itself
on 1/25. The second warning came on 2/25 and was
reversed on 3/10.
My NDX model has been bearish for awhile but first
indicated a change in
sentiment last weekend and despite the four day
decline this past week, the
underlying structure continued to strengthen.
Friday's outside day was
bearish and we could see 1482 before the turn.
Also the last Pivot low of
1490 should provide support. The next Near
Impulse forecast date is
Thursday, 3/17 so my guess is we see some
decline and sideways
consolidation before the up swing emerges.
Many of
you trade the S&P 500 and attached is a chart with previous
forecasted
reversal points indicated by the ellipses. As you can see Friday
was a
forecast reversal day but the morning attempt failed and we closed
near the
bottom channel of the current Andrew's channel. If we can hold 1200
it will
be bullish but there is risk of decline to 1186 to 1190 before a
full
reversal.
My analysis of individual stocks in the NDX shows a two to one
ratio of
expected advancing to declining stocks and thus signals to trade
the long
side next week whereas last week it was strongly favoring the
short side.
The areas to expect the best moves are in Communication
Services, Computer
Equipment, Internet, Retail and Transportation while the
weakest are the
semi's and Biotech's.
All in all, the mix is not right
yet for a strong advance but I believe it
is coming.
Regarding Gold and
the Dollar, I see a strong prospect for an advance in the
Dollar and Bonds
and a decline in gold.
Best Regards,
Jim White
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