FOR MONDAY: (4/10) These weekend breaks with saber-rattling are a bit unnerving, as Russia sends ships to the area and rhetoric flies. Cycles into April 13-14 do have more war/aggressive energy than the following week so getting through this week will be important but an underlying peace cycle may prevent anything series through late May. We have always worried more about war and violence July and August and that may be the more serious time period. Despite a decent finish on Friday, stocks look mostly lower into Wednesday of next week and it would not take much to trigger a weekly chart top, although we think NQ still could do a divergent high in May. The dollar should top out by Friday and be lower next week and gold and silver look lower next week and also T-notes which finally looked like they put in a reversal. These big-event days with extended ranges usually turn into key points for the month. If the news is volatile over the weekend, we will put out an update on Sunday night if we can but usually it’s too difficult to tell until Europe opens in the Middle of the night.
JUNE E-MINI S & P 500
SWING TRADING RECOMMENDATION: Sell June e-mini S & P at 2359 and 2364 with a 2368.50 stop.
S&P ANALYSIS FOR MONDAY: (4/10) We moved stops to breakeven and got stopped but had suggested partial profits a number of times and the market never took out our original stop into the close. We have a bias for lower prices into Wednesday, but won’t rule out going to 2364-2366 on Sunday night if there is some calm and sanity in the world. The failure to break 2340 on a closing basis didn’t confirm a weekly chart top and even if we get to projections to 2325 or 2318 quickly, we could recover in a congested manner. We do want to get short but may not get the chance.
OVERALL: We favor a fall to 2318 with a first cycle low into April 12 to complete a 3-3-5 pattern. Because cycles are volatile into Sunday and news continues to be on the edge, you have to favor shorts but will put out orders higher if we can get.
BIG PICTURE: The week before tax returns is often bearish and some sell stocks to pay for taxes and seasonals seem lower before taxes are due. We have a bias for lower prices next week and if the market remains congestive and cannot drop, then they may take the market up into next Friday.
LONGER TERM: (3/27) Still can’t officially say we have a weekly chart sell signal until 2300 comes out on a closing basis. It may be a while before we know if a weekly chart top is in. Expecting a May high and a new NQ high unless NQ takes out 5200–and if that’s the case, we’ll get a divergent S & P high to maybe 2420. Expecting that 2050 is possible into October for a 15% correction and cycle low and if the market closes under 2300, we would see 2200. Too early in the game to get too beared up but you can favor shorts into the week of April 2-6 and watch pattern completions. Still have to pick your spots carefully.
CYCLES OVERVIEW: Lower into April 12; higher into April 14.
