18,206 Breakout
18,104 2014 Peak
17,810 Last top and 200 days moving average
17,579
DJ Support: 17,400
17,279 Six months low
17,050 Very strong
Technical Analysis:
S&P and NASDAQ COMPOSITE supported over its 200 days moving averages. S&P has resisted the third attempt to breakdown the support at 200 days moving average, it shows its bullish bias barring a violation of this support. It means that buyers came in this important point. NASDAQ COMPOSITE still has its bullish bias and is the strongest index.
DJIA has tried to reverse from its six months low but it could not break DJ17,810 resistance. To recover a bullish bias DJIA has to stabilize over this level. DJIA is the weakest index and is doing lower highs with lower lows, which is negative.
We can conclude after technical analysis that the S&P with NASDAQ COMPOSITE remains resilient and they can bring support to the weak DJIA.
Please click over the charts to enlarge them.
Fundamentals:
Earnings season is almost gone and it didn't give us a summer rally. The stock market is going to move by the economic news and possibly by political during August with a low volume.
The long term bull market is toppish, watch the last seven months, but the upside bias is still in place.
August is the traders holidays time and it could be a boring month for the trading.
The market is evaluating how the China's currency devaluation is going to affect the activity, the Chinese Yuan has devalued 1.6 and 1.9%, Deutsche Bank is predicting the Yuan is overvalued by around 10%, so if the Yuan continues to weaken, the stock market should be affected. The rate increase should wait until the fourth quarter at least.
Dear traders and investors, it seems to me that we are going to navigate in the consolidation range during the next four weeks.This 2015 is very hard for the traders because it is toppish and stays into the range. My bias is still to the upside and don't forget that the long term bull market is still alive.
Good luck, viel Glueck, buona fortuna, buena suerte, bonne chance!
Ulises
Thanks Ulises, so far, so good! But, here's the other side of the coin: Yuan Devaluation means the second stage of the global economic cycle has begun (the first being the commodities price-drop). Meaning that as China stops expanding its already "over-capacity" industrial base, Chinese manufactures become sellers-at-any-price in order to survive. Which takes the price-drop wave to the globe's Real Economy, turning widgets into money losers, as everyone else and his brother drops their prices. Then comes...the third stage (TBC).
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