Stock Market Analysis

Monday, December 07, 2015

No New High?

Welcome back from the weekend! The market did exactly what I expected it to last Friday when the Jobs Report easily beat a very negative expectation, leading to a rally due to both being better than expectation and still low enough to keep the rate hammer off its back. This was what I wrote last week..

"The much lower expectation for this coming Friday's jobs report could also help alleviate some rate hammer fears. As such, tomorrow may be an interesting day in the market and possibly a positive one. However, even if it was a positive one, I won't be the first to speculate on a breakout."

Indeed, even though the market came back strongly last Friday, Monday today proved to be profit taking day once again as the market continue to struggle with the new high resistance level. In fact, unless the Dec 1 peak is taken out, the declining peaks pattern I spoke of last Wednesday stands, and it is a dangerous pattern at this level, at this stage of the stock market cycle and under such geopolitical situation. Failing here could spark that much awaited market crash and from the way global tension and situation is developing, 2016 has a really high chance of becoming that year.

Bond yields continue to flatten and total equities put call ratio traded nicely in the uncertain zone. All in all a bearish inclined uncertain day where there were plenty of buying and selling back and forth. From this point, I don't see how the market can make a new high given the lack of positive developments but plenty of negative ones. Like I said last week, this is certainly not the time for high probability swing trading. This is why my Star Trading System begun to produce single day trading opportunities, allowing us to make a 31.5% profit trade last Friday in just one day (Yes, don't miss these profits! Join my Master's Stock Options Picks Service now!)

Market Crash Timer: ORANGE

For now, the market remains in short term neutral trend within an intermediate and primary neutral trend.

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