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Stock Market Trend Analysis Newsletter.

The Stock Market Week - 10/03/2008

As we had mentioned in our previous publications, the S&P 500 is now in sub wave three of the third down wave, which is considered the worse in the five-wave structure. The recent financial events appear to be the worse in the history of US financial market so far. "America's economy is facing unprecedented challenges," president Bush declared.

It was the worst week for the US stock market since September 2001. All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 817.75 points, or 7.34%. The Standard & Poor's 500 Index dropped 113.78 points, or 9.38%, while the Nasdaq Composite dropped 235.95 points, or 10.81%.

The Consumer Staples sector was the strongest sector last week followed by the Health Care sector, while the Materials sector was the worst performing sector of the week followed by the Energy sector.

The Consumer Staples is the most overvalued sector now, followed by Financial sector; while Tobacco Products Other, Regional-Mid-Atlantic Banks, and Dairy Products are the most overvalued industries.

The Basic Materials is the most oversold sector, followed by Conglomerates sector, while Processing Systems/Prods, Metals Fabrication, and Aluminum industries are among the most oversold industries
Bear market statistics (19 during the last 100 years)
Description Average Current Worst Mildest
Time from the end of one bear market
to the beginning of the next
45.3 months60 monthsN/AN/A
Length of a bear market18.5 months12 months47 month
(ended in 1949)
2 month
(ended in 1987)
Bear market decline36%28%89%
(ended in 1932)
21%
(ended in 1990)
Dow Jones Industrial Average Trend Analysis
Dow Jones Industrial Average long-term chart has formed a head and shoulders pattern. The price retested the neckline and has resumed the long-term downtrend. The pattern should be close to completion, but the price did not reach the target yet. The sharp price drop moved daily William's Percentage Range (W%R) into oversold area, while weekly W%R is strongly oversold. The oversold W%R is usually considered as an early warning indicator that signals exhaustion of the sharp down trend and predicts that it may slow down and reverse soon.
Dow Jones Industrial Average - Long-Term Trend
Technical Stock Market Timing System
Standard & Poor's 500 Index Trend Analysis
Standard & Poor's 500 Index is in a long-term down trend that started on 10/11/2007 at 1576.09. The chart is forming a falling channel pattern. The support line is around 1140. The third wave down is in progress now. It has started on 5/19/2008 and it is now forming a sub wave three down as well. According to this wave count, the S&P 500 is now in sub wave three of the third down wave. This sub wave is considered the worse in the five-wave structure. Daily Lane's Stochastic indicator is oversold, while daily and weekly William's Percentage Ranges are strongly oversold. Other technical indicators might be in oversold area soon. The sub wave three might be close to completion within several weeks.
Standard & Poor's 500 - Long-Term Trend
Technical Stock Market Timing System
Nasdaq Composite Index Trend Analysis
The Nasdaq Composite index was in a long-term uptrend since 2002. As we suggested previously, the price was forming a symmetric triangle chart pattern. A triangle pattern usually represents an area of indecision, where the direction of the movement is questioned. In a mature trend a triangle chart pattern usually appears as a reversal formation. Recently the triangle pattern had a sharp breakdown with noticeable increase in volume. The price target for a triangle pattern is usually derived by measuring the distance between the starting high point of the ascending triangle with the starting low point of the triangle, which is then projected downward from the breakpoint.
Nasdaq Composite Index - Long-Term Trend
Technical Stock Market Timing System
Presented by www.thegreedytrader.com Research Group.

Sixth consecutive positive week for the S&P 500.
Almost 56% of S&P 500 component stocks have overbought weekly Williams' Percentage Range. It is the highest level since December 26, 2014.
Mar 5 , 2017
Third consecutive negative week for the Dow Jones
Almost 40% of S&P 500 component stocks have oversold daily Lane's Stochastic. It is a highest level since November 16, 2012.
Mar 15, 2015
Dow Jones is near 200 Day Moving Average
During the past week, Dow Jones Industrial Average sank 507.65 points or 2.87%, to 17164.95. Williams' Percentage Range and Lane's Stochastic are overbought in a monthly time frame. The Dow Jones price is near 200 Day Moving Average.
Feb 1 , 2015
S&P 500 at highest level since Oct 2007
The major indices and more than a half of S&P 500 members are strongly overbought in daily, weekly, and monthly time frames.
Mar 17, 2013
S&P 500 members Downtrend Resistance Alert
Dow Jones, NASDAQ, and More than 40% of S&P 500 members have the Downtrend Resistance Alert.
Oct 30, 2011
The short-term rally is over
S&P 500 index may break the support around 1100 and move down to the next support area around 1000 - 950.
Sep 5 , 2011
S&P 500 is close to the 50 Day Moving Average
S&P 500 index has fallen below the Parabolic SAR (stop and reversal). Price is close to the 50 Day Moving Average.
Mar 13, 2011
S&P 500 index wave's structure
S&P 500 medium-term uptrend has a five wave's structure. The fifth sub wave is near completion.
Dec 26, 2010
Monthly W%R is strongly overbought for the first time since October 2007
The S&P 500 technical indicators are pretty close to the beginning of October 2007, just a week prior the beginning of the bear market of 2007-2009.
Oct 17, 2010
More than a half of S&P 500 members are overbought
More than 10% of S&P 500 index members made a new 52-week high, but almost a half of them closed this week below the previous week's close.
Sep 12, 2010
S&P 500 members - Trend Support Alert
Daily and weekly indicators are oversold for all three major US indices. More than 28% of S&P members are oversold, and more than 22% have a Trend Support Alert.
Jul 4 , 2010
S&P 500 members - Downtrend Resistance alert
More than 60 S&P members have the Downtrend Resistance Alert. Daily Williams' Percentage Range and Lane's Stochastic are strongly overbought.
Jun 20, 2010
S&P 500 members - uptrend support alert
More than 30% of S&P 500 members have an uptrend support alert. This alert indicates that stock price is near the monthly uptrend support level.
May 23, 2010
Dow Jones Elliott Wave count
Dow Jones gained 68.03% in 53 weeks. The chart has formed a Rising Channel chart pattern. Fifth wave up is in progress.
Mar 21, 2010
NASDAQ at the highest level since September 2008
NASDAQ medium-term trend has formed a five-wave structure. The fifth wave is in progress now. The price is near the trend resistance line (2331.43).
Mar 5 , 2010
Is Dow Jones going above January high soon?
Dow Jones has advanced above the 50 Day Moving Average. MACD line has moved above its signal line. Both crossovers are considered as bullish signals.
Feb 19, 2010
The Dow Jones has formed a falling channel pattern
The Dow Jones lost 932.06 points, or 8.66%, since January 14. The downtrend has formed a falling channel pattern.
Feb 7 , 2010
The Dow Jones short-term down trend is near the support line
The Dow Jones is near the support line. Daily technical indicators are oversold. Almost 20% of S&P 500 members have an uptrend support alert.
Jan 31, 2010
S&P 500 has crossed below the 50 Day Moving Average
S&P MACD line has moved below its signal line; the price has crossed below the 50 Day MA and has closed below the lower Bollinger Band.
Jan 24, 2010
The Christmas rally has pushed the stocks ahead
The trend following indicators have turned bullish, while almost 20% of S&P 500 members are overbought.
Dec 25, 2009
Technical indicators caused a sharp stock market sell off
Strong resistance caused a sharp stock market sell off. The S&P 500 index has lost 3.3% in two days.
Sep 27, 2009
S&P 500 is forming a rising wedge pattern
S&P 500 is forming a rising wedge chart pattern. The next up leg could reach the resistance around 1075 in October.
Sep 6 , 2009
All three major US indices are overbought
109 out of S&P 500 members are overbought, 51 stocks have daily MACD bearish divergence.
Jul 25, 2009
S&P 500 - head and shoulders pattern
The S&P 500 has an Uptrend Exhaustion alert. Chart has formed the head and shoulders pattern. Price is near the neckline.
Jul 12, 2009
S&P 500 - Uptrend Exhaustion alert
The S&P 500 index has an Uptrend Exhaustion alert. The next resistance level is near 1044. The support is near 470.
Jun 7 , 2009
S&P 500 - downtrend resistance alert
The S&P 500 index has a downtrend resistance alert. The weekly ABC zigzag pattern is almost completed. Resistance is near 944.
May 10, 2009
The upside potential is limited
The S&P 500 upside potential is limited and chances are high that price will turn down soon. The support is near 805.
May 3 , 2009
S&P 500 chart has formed the broadening wedge
S&P 500 chart has formed the broadening descending wedge. The uptrend may pause for a while to reset technical indicators.
Mar 29, 2009
S&P 500 chart wave analysis
S&P 500 chart wave analysis and technical indicators suggest that the downtrend might be close to completion with the target around 650.
Feb 22, 2009

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