In summary, a breakout above the top of the range would be very bullish. However, there is still the possibility that the resistance at or just above current levels will hold.

 

light volume and small range, tempo has slowed down, but still bullish

In summary, we have seen volatile, back and forth price action. There were two rather violent declines, both stopping around 4060 area, so that is now first support level. The short term outlook is bearish. A break out from the current range should see follow-through in that same direction.

Today so far...

While some names are acting well, there is still plenty of mixed action in growth stocks below the surface as we speak which is causing some headwinds for bulls. The issue is not so much the initial headwinds as it is staying objective as to whether we see actual, violent rejection from the 20 day average price area on QQQ, or instead, just some backing and filling without rollover. Keep an eye on Bitcoin today, as another weekend leg lower could set the stage for some fireworks in stocks next week.

What is the best cure for sadness?

 "The best thing for being sad… is to learn something. That is the only thing that never fails. You may grow old and trembling in your anatomies, you may lie awake at night listening to the disorder of your veins, you may miss your only love, you may see the world about you devastated by evil lunatics, or know your honor trampled in the sewers of baser minds. There is only one thing for it then — to learn. Learn why the world wags and what wags it. That is the only thing which the mind can never exhaust, never alienate, never be tortured by, never fear or distrust, and never dream of regretting."

Review.

 1. Take a step back from the "flickering ticks" of daily market activity and focus on the long-term trends.

2. Reinforce the value of regular weekly and monthly routines as a way to approach the market more mindfully, deliberately, and with purpose.

3. Break down the latest signals in terms of price patterns, breadth and sentiment readings, investor sentiment and psychology, and market history.

ABX

 

The key to big returns is NOT big moving stocks. It's managing risk in relationship to reward. Having the correct bet size on. And turning your edge over as many times as necessary to reach your goal.

Rotation.

 

In summary, the market has been wounded by this sharp decline this week, but the SP-500 chart is not bearish. It would have to break support at 4000 in order for bears to have an upper hand.

 

"Test ideas by experiment and observation. Build on those ideas that pass the test. Reject the ones that fail. Follow the evidence wherever it leads. And question everything, including authority. Do these things and the cosmos is yours."

Now at this point yesterday was 80% decliners and today over 80% advancers. That doesn't tend to happen in bull market regime.

Distribution day for RTY closing near the lows today.

                                      For growth equity investors, cash is King for now!

While we wait to see if support in the market will hold or not.

 "In bull markets stocks don't go down on bad news. In bear markets stocks don't go up on good news."

AEM

 

It's all good for now, the line of least resistance is still to the upside, but we are at a point for the equity markets where the risk to the downside is greater than the reward to the upside.

BVN

 

CCJ

                                             produces 9% of all uranium in the world

In summary, the line of least resistance is still to the upside, but lately we have had more reversals and breakout failures than I've seen in a long time. Stocks have been breaking out of bases, just no follow-through.

Quote

Math.

 You gain 100% and lose 50% 10 times, you break even. You gain 10% and lose 5% 10 times, you make 71.64%. The key to big returns is optimal math, not the biggest wins.

In summary, the line of least resistance is still to the upside. After getting to all time highs a week ago, the market has lost some of its mojo this week. The overbought conditions are slowly beginning to take a toll.

SP- 500 support is at this week's lows around 4120, with stronger support just below the March highs, and the major support at 3870. If 4000 is penetrated that would be a short term negative, and if 3870 is penetrated that would be a major change of trend.

GDX - monthly view

  Now fiscal and monetary stimulus as well as negative sentiment could be potentially bullish for the metal.