How will stock market follow stellar first quarter?

With three steps forward, time may be ripe for two back

How is this going to resolve? There are several indications to look out for this week. By all means let’s see if China can hold these approximate levels without having to retest its bottom. Then watch Copper to see how it breaks or whether it is content to stay in its range. You also want to watch the XAU which is testing long term support near the 170 level. The mining stocks represented by the XAU are at critical support. A break here gives us the biggest correction since the 2008 commodity crash. Precious metals are in a long bull market, we can all agree on that. However, during this gilded age for Gold it has come to edge of the ditch many times and turned back up. This is one of those times. Finally, our chart of the day is the Apple computer which has come off the high but has very good calculations to this point and may be in a position to bounce in the 590-96 level. If it does that it should take tech with it and the correction will be moderated. It doesn’t mean we’ll go back up.

The outlook for the second quarter is not so clear. What usually happens is when major indices break through key resistance levels there is generally a period of digestion and consolidation. With the VIX where it is, it does not appear to have a lot of room to move higher from here. We’ll need more days where the VIX rises or periods where we get serious shakes of the tree to work off some of the happiness. Most important we’ll need the SSE to hold its bottom and we’ll need to see these indices establish where they want firm support to be in order for a fresh leg to materialize. We could see periods of backing and filling.

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fibonacci, apple, stock market, analysis, technical

About the Author
Jeff Greenblatt

Jeff Greenblatt is the author of Breakthrough Strategies For Predicting Any Market, editor of the Fibonacci Forecaster, director of Lucas Wave International, LLC. and a private trader for the past eight years.

Lucas Wave International (https://www.lucaswaveinternational.com) provides forecasts of financial markets via the Fibonacci Forecaster and other reports. The company provides coaching/seminars to teach traders around the world about this cutting edge methodology.

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