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Last week we saw the S&P 500 finally breakout of its sideways channel direction (green box) as news reports that China & US are back to talking again and are preparing to meet at the end of the month. The theory is that hopefully after over a year they somehow come to some sort of agreement. However interestingly the recent rally we saw last week for US stocks has been on below average volume as shown on the chart. Whenever I see this it tells me to be weary of any move seen. In other words its a red flag and can’t be relied upon as a trader.
 
Looking at the daily chart of the S&P 500, we can agree the positives is that it broke out of the box and is now trading above the 52 day moving average, which are bullish signals. On the other hand the price action has been hitting the original uptrend line, however as a resistance level rather than as a support level as seen back in June 19. Add in low average volumes overall on this spike higher and the weight of evidence isn’t totally in favor of the bulls.

Looking ahead for the week for the S&P 500 index, I'm looking to see if the price action can finally jump back above the long-term uptrend which it hasn’t been able to achieve yet. If we see a pullback this week to the support area of 2,940 and hold, this would be the ideal for the bulls. If it was then followed by a strong move higher with above average volume back inside the uptrend line either this week or next then I would agree that the S&P 500 will be heading for new record highs in coming weeks and months.
 
Given that the ECB are meeting this week to most likely introduce more QE & other stimulus, followed up by the FED next week for the FOMC. These two big events should keep US stocks elevated. However watch out for a wild card (Ie Trump tariff / trade tweet) and a move back under 2,940 area and back inside the green box this week, even though this is an unlikely scenario.

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The Nasdaq 100, which is the strongest of the main US stock indices finally broke its 2019 uptrend on Friday, as Trump was able to feed massive uncertainty in the markets, as investors lost complete confidence in Trump & most likely any hopes for the US to avoid a recession.
 
Leading up to Friday's shocking sell off in US stocks, the muted rally we saw during last week of small moves higher was in fact made on terribly low volume, which is considerable below the daily average.
 
The low volume during a move higher in trend, was similar to the slow run higher in July 19 to new all-time highs. This was also just before a strong sell off on increased volume that occurred. If you’re paying attention this would have been a big red flag for traders & investors.
 
Another red flag for the Nasdaq 100, is that we have confirmed a lower high and lower low signaling a change in control from buyers to sellers in the daily charts.

Looking ahead for the Nasdaq 100, the support area of 7,400 is the last final confirmation required from the market before we can confirm a change of trend. Therefore Monday's trading is super important for short term direction for the Nasdaq especially if we clearly close below this area. A breach of 7,400 support would indicate the next support level of 7,025 for the Nasdaq 100
 
Lastly unless there is some miracle from the Central Banks with more intervention, and we see a big shift in bullishness. With the Nasdaq 100 somehow jumping back above its uptrend line and above the 52 day moving average (green line).  We are likely looking at the start of the end of the bull market in US stocks.

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Apple share price finds itself in a rather interesting position on the weekly chart. If you take a look at the price action from the start of the 2019 you will notice its uptrend, with the price above the 52 weekly moving average, with higher lows formed.
 
However if you step back on longer time frame and view the chart you will notice that since December 2018 when Apple broke below the long term uptrend line, it has failed to move back above this trend on a consistent basis. In addition the price action has been bouncing off a large triangle pattern on the weekly chart for a third time.

If this were to fail and the price action broke to the downside this would be quite bearish for Apple & US stocks as the weighting of Apple would drag down the Nasdaq & S&P500. When observing triangle patterns the price action usually breaks in the direction of the trend, so this means the odds suggests that Apple either this week or in the coming weeks will break the current triangle pattern to the upside.

To confirm this a clear break of $212 resistance would need to occur. If this happens we will likely see a move towards $228 resistance. Based on the likely odds, this would also mean that the SPX index would hold its most recent bounce off the 200 day moving average and confirm a higher low, with a likely move to another higher high and new all time record high in the SPX.
 
Therefore the next few weeks will be critical for Apple investors & US stocks overall and likely dictate the trend going forward in the medium term for stocks.

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Google recently released its Q2 earnings to the market and looking at the monthly charts of its parent company Alphabet, the market appears quite happy with the most recent earnings results. The monthly chart only has a few trading days left to complete, with the current price action as of last Friday the 26th of July, Google is currently showing a breakout pattern above $1,227 resistance.
 
Considering that Google has been consolidating in a sideways pattern since early 2018, if Google can close above $1,227 for the monthly this will be a significant milestone for shareholders. The one important red flag with potential breakout pattern, is that volume for Alphabet is below its average monthly volume. There is another three trading days left of trading to increase volume levels, but given the earnings release and close to the end of the month you would like the volume to much higher to go along with this breakout potential.
 
On the bullish case if we do see a breakout pattern completed, we have a potential target of approximately $1,490-$1,500 resistance area on the monthly charts, which is based on the average distance away from the 52 month moving average that Google price action normally trades away from. Since those levels if achieved would be new all-time record highs, this is the only suitable method of targeting ahead.

The bearish case if Google price action was to fall back below $1,227 level by the end of July 19, then we would of have achieved a triple top resistance pattern. Which based on history would mean we would see a likely target back to $1020 support area, which would also mean that its long-term uptrend line would of also been breached if this was to be achieved.
 
Given the index weighting of both the S&P 500 and Nasdaq Indices, the likely success or failure of Google's price action is likely to have a decent impact on these two indices over the coming months.

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On Monday I discussed how Crude broke out above its resistance area & downtrend line. I said I would like to see consolidation and the 52 day MA turn back up before considering a long. Well since Monday, Oil has fallen sharply lower falling back inside the downtrend line, while also closing below $57.30 support and once again trading below the 52 day MA.
 
Given the 52 day MA is sloping down already and the setup we are witnessing this price action looks quite bearish at the moment. In the short term I'm looking for potentially a small retracement back to either 57.30 area, or a move back higher towards its downtrend line currently around $58.50.

However after the brief retracement process, I'm looking for Crude Oil to continue to roll over and head for $55.15 support as its first potential area to move towards.
 
Since on a macro level that global Manufacturing PMI's are rolling over at the moment, as well as supply rising from US Oil production its no surprise that Oil is weak at the moment. Since the last down move back a few weeks ago was around $50.60 level, its certainly possible we could reach this area over the next few weeks if we see follow through selling.

More importantly considering the 52 day MA is much lower now than 3 to 4 weeks ago, Crude Oil has the potential to move towards a lower area beyond the June lows.
 
However we are getting ahead of ourselves at the moment, especially considering how bullish US stocks are presently this could come to play on Oil & stocks this week and next since they are closely correlated.
 
Either higher stock prices can support Oil prices despite the bearishness or by forcing stocks to pullback lower in the short term. Its also important to note that on occasion the two assets classes have and can move in opposite directions for a while. But its certainty worth watching closely for the rest of this week.

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Copper continues to remain under pressure as it sits close to the lows reached at the start of Jan 19. The price action is in a consolidation sideways pattern over the last two weeks, as Copper prices in a slowing weak global economy.
 
This contrasts with US stocks over the last two weeks that has seen a large bounce off its recent lows on the prospects that Powell & the FED are now looking cutting rates in 2019. The prospect of rate cuts is inflationary for hard assets, however Copper is not buying this premise at least for now.

Currently the price action for Copper is sitting between 26,680 resistance & 25,940 support. In addition the price is respecting its downtrend line as well. So moving forward we would need to see a clear breakout above both 26,680 & 27,135 resistance, before we see Copper following the bullishness of US stocks. Given the weakness its more likely we see the price move towards 25,940 soon.

Platinum's price action is showing a close resemblance to Copper's price action, as it also has not seen any recent bounce in the last two weeks of trading, while also hovering near its lows reached In Dec 18 & Feb 19.
 
Why this is relevant is because Platinum is utilized in multiple industrial applications in multiple industries within the manufacturing process. So just like Copper, the price action of Platinum at the beginning of the year saw a decent rally and new uptrend formed as the markets were pricing optimism on the global economy based on a trade deal being struck between the US & China.
 
Now the deal has collapsed, the price action has collapsed along with the deal. Platinum is also in a consolidation pattern as it currently is respecting $800 support after hitting $820 resistance last week. Given that global economic macro data remains weak as global trade slows, it likely like copper we see lower prices in the short term.

So if we see a break of $800 support, look for a move towards $780. If we see a move above $820 in the coming weeks, followed by a close above the 52 day moving average price of $845 - $850, then this would indicate a shift in optimism for the global economy.

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Last week price action for US stocks was remarkable from the start to the end of the week. On Monday we saw US stocks gapped lower on the threat of tariffs on Mexico by Trump. With each trading day we saw weak or negative economic news being released in the US. Yet what we saw was stocks were no longer moving lower. By the end of the week on Friday we had US Non-farm payrolls released and it was a massive miss, coming in at 75k new jobs instead of 177k estimates, but it didn’t matter. By the end of the day stocks continued to move higher, as it followed the momentum of buying that started from Tuesday. So why successive pieces of negative news & economic data being released did the S&P 500 index form a bullish engulfing pattern on increasing volume? The answer in one word is: FED.
 
Last week Mr Powell held its monthly press conference and the general point of the commentary by Powell was that the FED would do what is required to keep growth going in the US. Which the market interpreted as the FED is about to start cutting rates, with the likely hood of several cuts to come by the end of 2019. The reaction by the market was swift, as we saw the US dollar index roll over and break its uptrend, while Gold shot up this week over $100 an ounce as the market digested another pivot by the FED moving forward. Which is why I realized this week that this lows reached at the beginning of the week was likely to be the lowest prices we will see moving forward for the rest of the year.

Looking at the price action of the weekly chart for the SPX index, you can see that we have confirmed another higher low was formed, as the most recent low close was still above the lows reached back in the first week of March this year. This confirms on a weekly chart that the buyers are still in control of US stocks. The other interesting thing is that volume on the previous two weeks of falling prices was below the average volume for the index. With this week bullish engulfing candle stick pattern was formed on slightly above average volume, which also confirms the bullishness of the move.

This week I would be looking to see if there is follow through for the week in higher prices to close the week, to support the bullish pattern. If there is follow though its possible, we could see a move towards 2,930 resistance level either this week. If we see follow through buying then the likely support on a retracement is 2,873-75 level to look for in coming weeks. If we on the other hand see this move as a failed move, then prices would need to move back towards 2,785 support. However this is unlikely now the FED has given the green light for stocks to move higher regardless of how back the economy is. Well at least for now that is.
 
Lastly on a more of longer term look ahead, given the outlook of the FED and the interesting price action for US stocks, it would not surprise me at all if we see new all-time highs reached in the coming weeks or at the least next few months.

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Crude Oil last week experienced the worse selloff for 2019 as it fell around -7% for the week. The price action has now confirmed the end of its uptrend, as well as confirming that the bears are back in total control of Crude. The reasoning for this is that the closing price on Friday is now comfortably sitting below its most recent low and support level of $60.40, which it smashed late in the week. In addition, the price action is also now firmly below the long term 52 day moving average (MA).
 
If you take a look at the chart back in late October 2018, which I have circled, you will notice a similar pattern shown. You an also see what followed next for Crude Oil, after the pattern was shown, closing below support and trading under the 52 day MA. Its not clear whether the same crash in prices is evident from the price action so far, but what is clear based on the weight of evidence from the chart, that at least over the next few weeks we are likely to see lower prices ahead, after we see some consolidation from the big moves seen last week.

Looking ahead for this week, I’m expecting to see some much needed consolidation with a potential move this week back to its old support now resistance, around $$60.40. This is because the price action at the end of the week respected support of $57.40 twice, with a double tweezer. The consolidation will allow the oversold price action to regroup as well as the 10 MA catch up to the current price action.
 
Provided Crude Oil holds and doesn’t firmly close above the $60.40 either this week or next, I’m looking for Crude Oil to rollover again soon and move back to $57.40 support, with an eventual target of $55 a barrel once we break the $57.40 support level.
 
If this scenario does eventuate it will likely also bring down the major stock indices of the Nasdaq, Dow & S&P 500. Of course in the era we now live in with the markets, we must also be aware of the possibility of the shock interventions of global Central Banks, when the markets are tanking, to reverse downside moves.

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