The broad market continued to gain ground and reduce the level of apparent resistance while defying downtrends and weak sentiment. This incr...
The Federal Reserve's caution and optimism in trading have also created an uptrend, shaking short-term sellers and unbelievers while allowing the market to climb the "slope of hope". However, the Fed is more predictable at this stage than a disruptive president who is criticized by his followers for compromising with the opposition. This is not a good outcome for China's trade talks, which are set to end in less than four weeks.
Stronger-than-expected jobs and economic data also boost morale and show little sign of the slowdown forecast by market analysts in the second half of 2018. Many American businesses continue to report strong sales, so employees are likely to be added in the coming months instead of tightening your belt by reducing staff. Of course, this can change without a Chinese deal, so it is best to think carefully before buying stocks or adding to high positions at these great levels.
The SPDR S & P500 ETF (SPY) resisted the 200-day moving average (EMA) last week after hitting a low in October and December. The three intrusions of the past moving average (gray boxes) reduce the uptrend and replace the main peaks. As a result, price action above $ 270 should be watched for an event similar to burnout, keep in mind that climbing to the highest December price of $ 280.40 will significantly improve the technical outlook.
The iShares Russell 2000 ETF (IWM) shows the long-term recurring forces playing in the first quarter of 2019, with a sharp decline until December 2018 in a downward trend from the 2008 bear market. This price level is fully in line with the 50-month, 200-week moving average, which also identifies low-risk buying opportunities over the past decade.
The monthly random oscillator at the same time fell to the over-sold level and turned into a bull cycle, predicting relative strength for six to nine months. This rotation occurred at approximately the same level as the index variable in 2010, 2011 and 2015, all of which had reached their highest levels before the rallies. Of course, this time it can be different, but the bears have to defend until the tick bar breaks.
Dow Apple Inc. (AAPL) also highlights these technical implications, falling to a 50-month, 200-week moving average in November. Previous trials in 2009, 2013 and 2016 revealed major buying opportunities, all before the new bull market peaked. However, the sales pressure during the 2018 reforms was greater than before, creating more layers of resistance that could slow or halt progress.
The monthly random oscillator was oversold for the first time since 2013 last month and went up, but has not yet reached a new buying cycle. Given the cessation of iPhone sales, what may happen in the future may be instructive for massive price action. In particular, failure to complete a bullish crossover may indicate a lack of purchasing power, which improves emotions. This will happen quickly if trade talks break down or the president resumes his attacks on China
