By Investor’s Yak
Action Zone (AZ) observations for the Market (S&P500, NASDAQ, Russel l 2000, and Dow Jones Industrial Average):
- Daily AZ’s are extended but setting up a late stage trigger well above 50% on the chart – be careful
- Weekly Charts show AZ #2 momentums are triggering but AZ #3 price conviction is still questionable
- Monthly Charts, still under construction for October, are triggering AZ #1 and setting up for AZ #2.
Major Indices are holding above the 50 DMA and weekly charts show AZ #2 indicates improved momentum to go higher in the longer term. This could turn into a fall rally which may allow the year to end with positive gains. The 5 bull/bear direction scenarios discussed in our October 11 article are playing out with a move toward the 200 DMA. Continue monitoring market progress for signs of stalling near the 200 DMA. Weakness is still sufficient for an early 2016 bear reversal. Only future market conditions will confirm or deny that assessment.
Event calendar affecting markets in October
8 October – FEDs September Meeting Minutes
9-11 October –possible IMF announcement of China as a world Reserve Currency
27-28 October – Fed meeting
29 October – Third Quarter GDP Report
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