All Star Market Timing

Folks,

Market Observations for the Week: The negative reaction to the Fed’s stress test of US banks and the big increase in COVID-19 cases in the south gave stocks a 1-2 punch on Friday and drove the SPX done to test SPX 3000 support. Negative Volume Reversal days for both the SPY and QQQ could give us follow through down early Monday. Crude oil looks oversold Sunday night but could still target the $36.87-$37 range early Monday. Gold washed out to $1754 early Friday and then staged a $30 reversal higher into the close – we may have finished an EW a-b-c correction last week and appear to be coiling for a run above $1800 early Monday. The USD may have finished a drawn-out EW a-b-c correction but continues to hold up around 97.5.

6/28/20 (Commentary for Sunday)
A negative reaction to the Fed’s bank stress test announcement after Thursday’s close set the market up for a big down day on Friday. Secondary closings in the south due to a spike in COVID-19 cases also weighed heavy on the market. The E-mini is just bouncing correctively Sunday night and that could lead to weakness early Monday. We need to be on the lookout for a possible sub-division down to a Wave 3 on the SPX early Monday – a heaving-volume break below SPX 3000 would be a tell-tale sign of a big flush. Crude oil could target $37 early Monday or the pivot at $36.87 which would give us 5-waves down on the hourly chart. Gold washed out to $1754 early Friday and then gave us a $30 reversal into the close – we may have seen an important low on Friday that could lead to another test of $1800 early Monday. The USD gave us a 3-wave pullback from Friday and looks ready to reverse higher and test 97.5 again early Monday.

Big Picture on Stocks (UPDATED) – The SPX price action from the high of January 2018 to the low of March 2020 was a large Running B-Wave correction in Elliott Wave parlance. June 15 was the end of Wave A down of an EW a-b-c correction in the NDX– we may have seen a B-Wave top on 6/23 and a C-Wave down start on 6/24 which could extend down into Monday.

Big Picture on PMs (UPDATED) – Gold tested $1754 on Friday and staged a $30 reversal higher into the close – we may have started another leg up to test $1800 on Monday. Seasonality goes strongly positive for gold in early July.

• Stocks – The bank stocks led the SPX down to test 3000 on Friday and the E-mini is only bouncing correctively Sunday night – a high-volume break below 3000 on Monday could indicative the start of a Wave 3 of C down.
  
• Gold – Gold washed out to $1754 on Friday before staging a $30 reversal higher into the close and – we may have started the next run higher to test $1800 early Monday.
  
• Silver – Silver closed near weekly highs on Friday and the silver stocks are leading which is bullish.
  
• Bonds – Bonds broke out of wedge pattern on the hourly chart last week – TLT may be the play.
  
• Crude Oil –
  Crude oil could test $37 early Monday – touching $36.87 would give us 5-waves down on the hourly chart.
  
• Dollar Index – The USD is coiling Sunday night for another bounce to 97.5.
  

   

TURNING POINT DAY

The turn windows for this week are 6/29 and 7/1.