DJIA Daily Chart Review

This DJIA is about the same as the SP500 in how far this bullish move has gone.  The DJIA still has a Death Cross below it even though the DJIA blasted right through both MA lines.  At 24,200 the 50-day MA might give the DJIA some support, but any correction could keep this Death Cross alive much longer.

The commercials don’t have a big bearish position, so this can give the DJIA a bit more wiggling room in the short term.

I’m not going to spent too much time on this update but the Gold/DJIA ratio is still near the extreme expensive side of 19.62, better than the 21:1 ratio I did have back in August 2018.  A cheap DJIA index would be 8:1 but that will not happen anytime soon.

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SP500 Daily Chart Review

The SP500 and other indices wave positions I had have now pushed further that I would like to see, so changes have to be made.  This 2800 price level has been hit for the 6th time this year alone, so it will be critical to see how long this bullish move will last. Even though this stock rally looks like a real impulse wave, there have been many like this which have been completely retraced. Gold is just one example.

The commercials are not skewed that much to the bearish side so that adds to the uncertainty to this bullish phase, in the short term. The Gold/SP500 ratio helps as it is at 2.10: this morning. This is still about as extreme as it gets as my last extreme was 2.41:1 back in September of 2018.  We also have one wicked H&S being set up and in a bigger bullish phase, the right shoulder will not hold.

Market players are always waiting for something to happen that will paint a bullish picture, like the trade talks. Fundamentals change like the wind and basing investment decisions on the words of a politician usually never last as emotional investors can interpret any news a thousand different waves. There are many contradictions made by the mainstream analysts and that alone is enough to take pause to see how long this bullish phase will go.

HEDGE decline to new record lows which makes it out of sync from the SP500 index by a large margin. HEDGE has far more “slippage” in it than I originally though, which makes it unsuitable for a long term investment/trade. When there are options inside an inverse ETF, I would not waste my time with it, so I will no longer spend my time wave counting out HDGE. Besides that, if HDGE  ever got closer to the $5 price level, an inverse split can happen. A normal inverse split can be a 4:1.

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My updates are going to be erratic and reduced this year. I will post updates on my page.

https://elliottwave5.com/elliott-wave-5-0-possible-status-change-in-2019/

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