My Take On The US Equity Markets For The Week Of 8/5/19

This past week, Fed Powell cut rates…as expected.  Markets will typically rally after a rate cut due to lower borrowing cost for companies, translating into higher profits.  And we did get a rally, until Trump twitted an additional 10% tariffs on the remaining $300 million of imports from China.  That twit alone lead to a 700 pt reversal in the Equity Markets and the stocks closed at a level not seen since late June.

S&P 500 – Big Picture

Lets Zoom In

Price fell back into a daily demand on Friday. Although price reacted to the zone, I don’t know if there are enough buyers to take out the sellers. The zone is no longer fresh and the chart suggests price will fall further down to 2890.

DOW Big Picture

Lets Zoom In

There is a major support/resistance line band near 21000.

I think there is more downside risk as I’m looking for price to fill the gap and react to the daily demand at 21000.

Nasdaq – Big Picture

Lets Zoom In

Daily demand is about 200 points lower.

However, on the 4 hr hour chart, there is a 4 hr daily demand that I would of taking long, but it was a Friday and I didn’t want price to potential gap against me on Sunday. So going into Monday, if prices hold, after I see some potential strength, I will look to go long on a pull back on a 15 min chart.

NOTE: the better 4 hr demand zone is lower because it represents more of a discount and embedded within a daily demand zone.

Russell 2000 – Big Picture

Lets Zoom In

Prices remain sideways, the only way to play the Russell is to play the extremes as indicated on the 4 hr chart.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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