Summary In last week s digest I was looking for more upside after the NFP-rally. We got to SPX2802 and that was all she wrote this week. Then the markets went into 3-4 day long declines almost entirely retracing the NFP-rally eventhough it was on very strong breadth (97% up-day for the DOW, >90% up-day for the S&P, NDX/NAS MO s making highs not seen since March 2017 latest, etc). Hence, there are no guarantees in the markets, only probabilities, and uncertainty has therefore increased once again on where the market exactly is from and EWT-count perspective. The standard impulse (preferred), Ending Diagonal Triangle (1 st alternate), and Zig-Zag (4 th alternate) all remain valid. We can add a possible Leading Diagonal Triangle for intermediate-i as well (2 nd alternate). Hence, I must admit I honestly don t know what EWT-count is operable. But, we can continue to look at price levels. For example, below SPX2702 and option 1 is off the table. In this update I show a color-coded hourly chart based on trendlines to help define uptrends and downtrends. Breadth is still OK and in the Bullish camp, but now only marginally. There s a turn date slated for the Fed-meeting on March 22, let s see if that s the catalyst the market is looking for? How to trade this? On can keep stops at a close below the 50d SMA and 20d SMAs for the S&P and NAS/NDX. There s no buy signal for the DOW yet. Please don t set the stops too tight (cents) but use whole numbers (dollars) 1 P a g e
Trading Performance Update with Hedge Fund North Post Partners, LP NPP provides neither a boom, nor a bust. Just consistency. Our first week of trading in our LP account gave a few losing trades and we re currently holding a few positions that are under water. But, remember, our system is designed to enter low risk/high reward positions and we can easily handle say 10 losses of 0.5% as we only need 1 win of 10% to make up for all those losses. This shows that your win/loss ratio is not the most important factor but keeping your losses small is most important. Trading is all about managing downside risk as the upside will take care of itself. NPP, LP s To Date performance to date since we went public/live on January 2, 2017 compared to several major indices. Insert shows YTD performance. Now that NPP has transitioned into a Hedge Fund we accept new clients. Several of you have already contact us! Thank you! Others, please contact me or NPP s President, Rus Chao, directly (rustinchao@gmail.com) for more information. We do the hard work, i.e. trading for you, and you get to reap the rewards! Please follow NPP on TWTR: @NPPtrades (all intra-day trades are provided there in real time) Please bookmark NPP s website: http://northpostpartners.com/ (weekly digest/trading plans are posted there) *It should not be assumed that future performance will always be guaranteed and/or profitable. Nor will future performance necessarily equal past performance or past performance trends. All trading and investment decisions are the sole responsibility of NPP. Joining NPP is free, but does not exclude commission costs, and other possible charges. 2 P a g e
Elliot Wave Updates The countable and quantifiable i, ii, 1, 2, i, ii, impulse count remains on the table and preferred until proven otherwise: a trade below SPX2702 will have me alter this perspective. See Figure 1A. But, this is the only impulse count left for the Bulls. The other counts are still 1) the EDT; 2) a triangle 4 th (on the DOW only. It has been eliminated on the S&P); 3) and now we must consider a Leading Diagonal Triangle Intermediate-i wave possibility. More about that later. For now and bigger picture wise, see Figure 1B: as long as price remains above the upper support line (green area) the general trend is up. If price moves below it (orange area) the trend becomes side-ways. If price drops below the lower support line (red area) the big picture trend is down. KISS Why? Because these trendlines go back to March 2017 high and have thus been very important. Figure 1. S&P 1-min chart. A) impulse underway remains preferred count. 3 P a g e
This week price still managed to close above its 20d and 50d SM. Thus, the short- to long term trends remain up, which is in-line with the color coded hourly chart shown in Figure 1B. However, the A.I. is on a sell since earlier this week, and the MACD and MFI14 are not looking too healthy either. The Bulls need 2-3 days of solid upside to change the perspective of this chart. Here the possible leading diagonal triangle for intermediate-i of major-5 is shown. It targets ideally SPX2820ish, followed by an ideal 62% retrace of the triangle, which will be a fast and furious move, targeting SPX2640-45ish, and then we can still see an ideal major-5 target of SPX3150-3215. Figure 2: S&P daily TI chart: price closed above its 20d and 50d SMA, A.I. on as sell, but MACD on buy. Possible intermediate-i triangle shown. 4 P a g e
Besides the impulse and the LDT, the other two options remain the EDT (Figure 3A) and the infamous zigzag with a big c-wave down to come (Figure 3B). Given that the big-money options flow is neutral it seems the latter option is not as likely because big-money would already be positioning for it. They are big-money for a reason It also continuous to be the Bears wet-dream but only as long as they keep moving their goalpost further north and switch from index to index. As said in earlier updates: imho too obvious and discredited by TECH, which has made new ATHs already. Figure 3. S&P daily charts. A): Ending diagonal Triangle, which no other EW-service I know is even considering. B) zig-zag with b-wave complete (too obvious!?) Bottom line: there are still many options on the table, and from an EWT perspective I must say I honestly don t know which of these four options is operable, although I find the c-wave down least likely. 5 P a g e
The weekly S&P chart remains in an uptrend as the weekly SMAs are still bullishly aligned (price> 20w>50w>100w >150w> 200w), and all are pointing up. Price got rejected again at the upper red trenline and the possible diagonal pattern (blue line) is shown here as it is rather obvious. Uncertain though of it is operable. The A.I. remains on a buy, but the MACD remains on a sell. Conflicting signals. The peak RSI5 and MFI14 readings in January without any negative divergences continue to suggest we should see higher prices eventually. Figure 4. S&P weekly TI chart: still bullish, but few conflicting Technical Indicator signals. 6 P a g e
Market breadth, Simple Moving Averages Charts and Volatility The SPXSI (McClellan Oscillator [MO] derived Summation Index for the S&P500) is still on a buy at the close onfriday as the SPXMO ended the week at +2. Down 57p compared to last Friday s close. Except for the DJIA-SI, which still has not given a buy, all daily MIs turned to a buy this week. The SPX-A/D line in Figure 5B is holding support (red trendline) and made a new ATH last week (green trendline0, suggesting we should see higher prices going forward. Figure 5. A) The SPXSI still on a buy, but breadth needs to strengthen. B) SPX cumulative A/D line made a new ATH and is holding support. A B 7 P a g e
The Simple Moving Averages (SMAs) trend-following charts show the short-term chart is still mostly bearish as it remains at around 40% Bullish. The long-term chart is still 100% Bullish. Thus, the long-term trend remains up, and there s no slowdown in sight. Figure 6. Short term Simple Moving Averages: 40% Bullish. Long Term Simple Moving Averages: 100% Bullish. Copyright Intelligent Investing, LLC. May not be copied and/or distributed without permission. www.investingintelligent.com Copyright Intelligent Investing, LLC. May not be copied and/or distributed without permission. www.investingintelligent.com 8 P a g e
Fib-based Turn Dates & Bradley Turn Dates Nothing has changed from last week as the next Bradley turn date is on March 27, and my Fib-based TD on March 21, which align nicely. All TDs are always +/- 3 trading days. Interestingly, the Federal Reserve (FED) will meet March 20-21 and announce its findings on March 22 Lets see how that plays out. Figure 7. Fib-based turn dates. 2018, Intelligent Investing, LLC. This copyrighted weekly periodical is published on non-stock market trading weekend days by Intelligent Investing, LLC, and is intended solely for use by designated recipients. No reproduction, retransmission, or other use of the information or images is authorized. Legitimate news media may quote representative passages, in context and with full attribution, for the purpose of reporting on my opinions. Analysis is derived from data believed to be accurate, but such accuracy or completeness cannot be guaranteed. It should not be assumed that such analysis, past or future, will be profitable or will equal past performance or guarantee future performance or trends. All trading and investment decisions are the sole responsibility of the reader. Inclusion of information about managed accounts, program positions and other information is not intended as any type of recommendation, nor solicitation. For more information, contact intelligent investing at intelligent_investing@yahoo.com. I reserve the right to refuse service to anyone for any reason. 9 P a g e