Stock Market Analysis

Wednesday, August 02, 2017

Uncertainty Continues To Build Up... Intermediate Correction Coming?

US Market continues to struggle as uncertainty continues to build up while the Dow continues to be the runaway horse, making yet another significant positive day.

However, like I told paid subscribers in yesterday's paid only report, the Dow don't seem to be able to lead as a runaway like the Nasdaq can due to it being comprised of just 30 stocks. Here was what I said...

"...I am not so positive when the wild horse is the Dow as the Dow contains too few stocks to be very representative of a significant portion of the market."

 In fact, I do expect the intermediate correction to start when the Dow at last runs out of steam and turns downwards. Yesterday, I explained to paid subscribers a formation that the Dow made which indicated that it has ran out of steam (wish to be on the paid subscriber email list? Subscribe by hitting the yellow button on the right below my profile photo) and interestingly, the Dow continued to make yet another of that indication, making it increasingly dangerous and therefore increasingly uncertain. Another thing that supports the intermediate correction happening at this level is how the market failed to react positively and strongly to a surprisingly strong ISM index released yesterday. The ISM index, along with the Jobs Report, is one of the two most important economic indicators that investors and the Fed watch very closely. The fact that even such a report failed to move the market tells me that the slightest bad news may start a bear slide.

Looking inside, bond yields barely nudged and total equities put call ratio remained at par as both investors and traders remain uncommitted to either direction. This is a very typical behavior when the market is at a very uncertain point.

"Uncertain" means that investors are not committed strongly in either direction due to having plenty of reasons to believe that the market can go up as well as down. If uncertain means down, it won't be uncertain, right? 

Yes, even though I am seeing increasing signs that this may be the start of an intermediate correction, investors and traders are both not committed to my prediction yet, perhaps waiting to see how Friday's heavyweight Jobs Report would turn out. However, with the Jobs Report widely expected to miss expectations, that may be the trigger that push investors and traders towards the bearish camp.

Today, me and my Master's Stock Options Picks Subscribers would also be looking to exit the last of our profitable call options positions. Did you profit from this last rally like we did? Join me for just $1 now!

For now, the market turns a short term neutral trend within an intermediate and primary bull trend. 

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