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US Market Outlook 3-13-16 (video)

The video begins with an overview of various trend indicators, nearly all of which remain bearish on both the long-term & intermediate-term time frames while bullish on the short-term frames. (start to 15:15). At the 15:16 mark, the weekly charts of several key US stock indices are covered. At the 23:49 mark, the daily time frames along with key overhead support levels as well as my own trading strategy are discussed. The video wraps up with a look at the recent developments & near-term outlook for the markets with a review of the 60-minute index charts.

Bottom line, the technical evidence still appears to confirm that the US markets are still most likely in the early stages of a new bear market at this time & the r/r remains skewed to the short-side at this time although there are still quite a few individual stocks and sectors that appear bullish at this time. There is still a good chance that we could be looking at a bifurcated market in the coming months which will favor a long/short portfolio, focusing on the most bearish & bullish sectors & individual stocks.

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Mar 13, 2016 8:20pm|Categories: Equity Market Analysis|Tags: , , , , , , |18 Comments

18 Comments

  1. snp March 13, 2016 9:00 pm at 9:00 pm

    comprehensive!

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    • rsotc March 14, 2016 9:03 am at 9:03 am

      @snp Comprehensive- Translation: Long… lol. Still working to get all videos down to 15-20 minutes in duration but it can hard enough to predict where the market going that simply talking about just a couple of time frames or indicators only tells a small part of a much bigger picture.

      To all, thx for the feedback. BTW, that bearish rising wedge on crude futures that was posted in the trading room last week has broken down impulsively today. Will post the chart in a minute.

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      • snp March 14, 2016 2:18 pm at 2:18 pm

        I don’t think long is negative. actually I play most of your video 3 times or so to catch everything

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        • rsotc March 14, 2016 4:20 pm at 4:20 pm

          @snp Then if you like long videos, you’re going to love the Long Trade Ideas Update video that I just posted. 😉

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          • snp March 15, 2016 12:29 am at 12:29 am

            lol. yes I will!!! good on ya

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  2. joefriday March 13, 2016 9:10 pm at 9:10 pm

    Love it man!… Great work!!

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  3. david k March 13, 2016 11:30 pm at 11:30 pm

    Fantastic work Randy. Thank you.

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  4. detailsart March 14, 2016 12:19 am at 12:19 am

    Thanks for the market update and overview. Informative as always. The major indexes have been up for four weeks which suggests that we may be in overbought territory. But, many indexes are also just pushing above the 200 DMA which begs the question of programed trading. Will a move above the 200 DMA contribute to automated buying pressure of ETF’s and equities (assuming all other external factors remain neutral) and thereby push the SPX higher? Thoughts?

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  5. schooner March 14, 2016 1:01 am at 1:01 am

    Well done summary Randy — you kept me up late! I agree that we are coming into a critical area — and interestingly enough we are working our way towards favorable seasonality for the downside. Thanks for the great work.

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  6. Shambo March 14, 2016 6:44 am at 6:44 am

    Thanks Randy, great video, clear analysis.

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  7. Shambo March 14, 2016 6:44 am at 6:44 am

    Thanks Randy, great video, clear analysis.

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  8. vodeux March 14, 2016 9:06 am at 9:06 am

    There is clearly a tight flag on the sp-500 and the qqq end feb and early march. It should point that the market will rally not breakdown. Also The last part of sp-500 looks alot like GDX with its never dying hypobolic curve. Everyone in the market including their mothers are calling this a bear market rally, and I think its never that easy to call an end to the bulls especially with this kind of mometum. Just dont be so surprised when the market rallies another 5-10% in march.

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  9. jegersmart March 14, 2016 10:01 am at 10:01 am

    Vodeux

    Thanks for sharing your thoughts. I think many are calling it a “bear market rally”, simply because currently it is. That is to say that no new ATH high has been made from where the downtrend began. No one is saying it is impossible for the market to make new ATH, and of course at some point it definitely will – the point is that if you had cash now that you wanted to put in a short term trade would you go long or short? Currently this is a bear market rally, because it is rallying within a downtrend. If it breaks out of the downtrend decisively and on volume then the game changes. That is why Randy has given some indications in terms of his “lines in the sand” – limits to where he still feels that the RR ratio is still short. We will of course see what happens and look forward to hearing where you are putting your money….:)

    J

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  10. vodeux March 14, 2016 11:35 am at 11:35 am

    sure you r right on how id be confused on my next move should I have cash on hand, fortunately/unfortunately I dont have any cash atm… FYI I am still long aapl, and after losing about 60% on dust, I put all the rest of my money in it again last friday. I’ve been following this site almost 5 years now (maybe longer) and I’ve always respected randy’s views and opinons. Its just that I recall his comment and arguement made for GDX a while back. Since we are quoting him, here’s the quote:

    “high & tight flag/pennant” that appears to be forming in GDX. My answer was no (along with a brief explanation which can be viewed under that previous post) and this video covers in more detail as to why I still believe the R/R for going long the miners at this time is unfavorable.

    I remember this vividly because I added more dust after that video…Since then I dont follow so blindly into trade ideas. But on the brighter side I do have more trading techniques now thanx to the rally that followed after. Which brings to me to this latest video, and why i’ve commented. The same pattern has emerged and the same agrument has been made, so this time I’ll follow my prior experience and buy (if i had money). The saying goes, if it walks like a duck….etc
    If RR is questionable just go ahead and buy a stock with a lower beta instead of something like dust and keep a tight stop.

    This is for another time but I also dont agree with the analogy market up/gold down (vice versa) or Gold up/miners up (vice versa) analogy, just a quick chart or SP500&gold here:
    http://seekingalpha.com/article/270029-relationship-between-stock-price-direction-and-gold-silver-and-copper

    u can see that sp500 and gold both rose during 2003 until 2009. and again from jul 2011-2013 (dont have charts). With this is mind the recent inverse relationship might change espeically with the announced interest rate hike.

    as for the other contradictory comment I just noticed many times gold down miners up situations to recall. I wish i was sophisticated enough to the charts but then again I could be wrong if I did… anyways its just my 2 cents!

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  11. jegersmart March 14, 2016 12:26 pm at 12:26 pm

    Vodeux

    I would definitely look at your position sizes if you lost 60% in DUST and put the rest of your money back in it last week. The number one rule of trading is not technicals, fundamentals and so on – it is “money management”. That always comes first regardless of the processes you use to make trading decisions. This is not a criticism, just a reminder that this should unequivocally and always absolutely come first….

    Good luck!

    J

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  12. vodeux March 14, 2016 1:08 pm at 1:08 pm

    Thanx J, not trying to degrade your comment, but the last time I heard that term was from my friend in a casino! He proceeded to lose $46k that night…true story. But the concept of money management surely differs among different people. R/R goes hand in hand, higher risk = higher reward. My idea of money managment is that I just simply allocate whatever leftover money that I can afford into equities. I can sleep at night as I will still have a roof over my head if I just blow up one day. If your thinking of money management as in P/L then you simply can’t expect to do proper money mangement on higher beta stuff such as commodities or tech companies, when the swing could be as high as 30% intraday. I noticed u r interested in oil and gold recently, and Im sure if you were in leveraged ETF’s like ERX, UWTI, NGUT…a tight stop will be definately detrimental to any notion of managment. In anycase thanx again for ur advice, hope you were in ERY today~

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  13. jegersmart March 14, 2016 2:03 pm at 2:03 pm

    Vodeux

    I think that is probably a coincidence that you heard it in a casino tbh, I cannot see any relevance. What I am saying is that one should trade a size which is not going to hurt you. Of course if your idea of risk management is still having a roof over your head if some trades go bad, then we are on totally different planets in terms of why and how we do this haha. I made almost 160% in the last 12 months, and no trades could have lost me more than 8% of my pot. I normally aim for under 4%, but have been fairly aggressive at times. The money management I am talking about is protecting your capital by trading within your limits. Losing 60% on one trade is totally unacceptable to me, I do this for a living – 60% is what sounds like a casino night to me…..seeing as you mentioned it:)

    Anyway, not criticising – everyone has their own risk appetite – I wish you good luck in your endeavours.

    J

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  14. vodeux March 14, 2016 2:38 pm at 2:38 pm

    hmmm, i thought I covered everything u said and then some. Nevermind, I trade oil for a living. 60% loss of capital is nothing new and roof over my head meant that I trade within my means 🙂 Anyways, good luck to u 2

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