Bear-bull Battleground in Key Resistance

DJ Resistance:  18,351      All-time high
                        18,206      Breakout
                        18,104      2014 peak
                        17,978      November 2015 peak
                        17,810
                        17,579      Inflection point
                        17,242      200 Days moving average
                        17,125      Old support
                        17,050      Old strong support
                        16,933.43 September peak
                        16,667      Very strong
                        16,628      50 Days moving average
                        16,468

 DJ Support:    16,200     Light
                        15,980     Strong
                        15,766     January closing low
                        15,450     Strong
                        15,370.33 Very strong 2015 low

Technical Analysis:
The market bounced up forming a W bottom and it stopped just in the key resistance which is a bear-bull battleground (DJIA 16,667 and S&P 1,950). If W bottom breaks up the resistance it would be a great victory for the bulls but its fight will be harsh and long. They need to sleep and stay over DJ 16,667 to look for the next up leg and chart repairs.
50 days moving average worked as resistance (DJIA 16,628 and S&P 1,947). Market touched them and retraced this Tuesday. It was very technically (please watch it on the chart). Next support is at DJ16,200.
DJIA is stronger than S&P this time.
The charts in the long term maintain its bearish-leaning trend, in the immediate outlook DJIA and S&P should try again to attempt against the resistances and if they fail we will visit the strong supports to say the least.

Please click over the chart to enlarge it.

 Fundamentals:
The Monday and initially Tuesday up move came from oil up move which today was stopped by oil minister of Saudi Arabia oil minister remarks about refuse to cut production. Its idea is to satisfy its clients.
Energy business based on a U.S.$ 100.- per barrel could fail and the banks which finance them are risking big losses.
Investors are fearful about banks' liquidity. Last week Deutsche Bank CEO said "solid as a rock" and the market sold it off. We can also see how much the cost to insure banks' debt have soared Deutsche Bank 180% and Credit Suisse has been affected too. Personally I think that today banks are better capitalized than in 2008.
U.S.A., EU, and some Asian countries are doing well. Consumer spending and Confidence based on a strong labor market besides earnings season are driven good sales for different industries like cars, housing and naturally entertainment. Indexes are not in its all-time high and we are facing price corrections, what happens or what fear is in the air? Recession fears are in the air.
Dear traders and investors, the trend shifted to the down side in the long term but in the short term it is not clear because the indexes are over strong supports. I expect lower stock prices that would be healthy for the financial markets because lower P/E.

Good luck, viel Glueck, buona fortuna, buena suerte, bonne chance!
Ulises           

Bounce Up Still Below Important Resistance

DJ Resistance:  18,351      All-time high
                        18,206      Breakout
                        18,104      2014 peak
                        17,978      November peak
                        17,810
                        17,579      Inflection point
                        17,322      200 Days moving average
                        17,125      Old support
                        17,050      Old strong support
                        16,933.43  September peak
                        16,667      Very strong
                        16,468
                        16,200      Light
 DJ Support:
                        15,980      Strong
                        15,766      January closing low
                        15,450      Strong
                        15,370.33 Very strong 2015 low

Technical Analysis:
DJIA went down and before DJ15,450 support bounced up and began a possible rally closing today at DJ16,196. Next crucial resistance is at DJ16,468 and the gauge bear-bull resistance is at DJ16,667, S&P equivalent is SP1,950. Over that resistance the bulls can dream about charts repairs and new leg up. The 2016 financial markets plunge has generated a mayor technical damages on the charts.
DJ15,980 is again a strong support.
In the short term the DJIA is looking to bounce up and is bearish-leaning in the long term. Bulls needs to bring DJIA over DJ16,667 to try to change the trend.
The one year daily chart has a potential triple bottom.

Please click over the chart to enlarge it.

Fundamentals:
The market's bounce is due to the 4 oil export country decision to freeze the oil production. It generated an increase in the oil price of 12%, it got over U.S.$31.- per barrel in the last days. DJIA bounced up 2 Monday) and 1.39% (Tuesday). Oil stocks gained 2.5%. What does the difference between 12% oil prices increase versus oil stocks 2.5% increase mean? Investors think that the oil up move is limited in a small period of time.
We have to pay attention about the U.S.Dollar strength because it will limit U.S. exports and the U.S. corporation's dividends repatriate to U.S.A.
European banks are getting some troubles specially Italians because they have not created a bank for bad loans. The ECB (European Central Bank) has to put more money in Italy providing liquidity to the domestic market.
DJIA nor S&P are not in a technical bear market, then the whipsaw are going to continue because S&P could look for SP1,710 which is the 20% correction from the all-time high.
Stock market is bouncing up which is a good new. Japan GDP decreased 1.4% and China exports fell 6.6%.
Dear traders and investors, the market tries to bounce up but it is too early to take a bullish bias, it could be a dead cat bounce.

Good luck, viel Glueck, buona fortuna, buena suerte, bonne chance!
Ulises

DJ Resistance:  18,351      All-time high
                        18,206      Breakout
                        18,104      2014 peak
                        17,978      November peak
                        17,810
                        17,579      Inflection point
                        17,388      200 days moving average
                        17,125      Old support
                        17,050      Old strong support
                        16,933.43 September peak
                        16,667      Strong
                        16,468

DJ Support:
                        15,980      Strong
                        15,800
                        15,766      January closing low
                        15,450      Strong
                        15,370.33 2015 low very strong

Technical Analysis:
DJIA is fighting over very important supports (DJ15,370.33, 15,450, 15,766 and 15,980) and it needs to break above DJ16,667 to give opportunity to the bulls for a next up leg. S&P is almost on the same backdrop and needs to sleep over SP1,872. S&P next important support is SP1,812. DJIA stays in a range during the last 15 days and is stronger than S&P.
Support DJ15,980 is constantly tested and the lukewarm bounces up are still away from the important resistance DJ16,667.
Have DJIA formed a head & shoulder? It seems it (please watch 6 Months Daily Chart).
The DJIA bearish-leaning for long term is becoming more consistent.

Please click over the charts to enlarge them.

                     
Fundamentals:
Last Friday January unemployment rate 4.9% was positive for the U.S.A. economics, non-farm payroll were less than expected. These and other economic news bring us to expect that FED is not going to raise interest rates on March and maybe it is going to wait until the end of the year.
The U.S. economy grew 2.5% in 2015 and the White House have projected 2.6% for 2016 and 2017. The Federal Reserve has forecasted 2.4% growth for 2016 and 2.2% for 2017. In summary the U.S. economic expectations are positive. EU is growing at a slower pace, China at 6.9% in 2015 and expects same for 2016, Brazil is really in problems, etc. It should be enough for a stabilization of the financial markets but fears about possible global recession are driving the selling-off, the big problem is if panic drives the markets.
England, Japan, France, Germany, Hong Kong and China already are in a bear market (have lost more than 20% from all-time high). S&P have lost 13% from the peak. May U.S.A. financial markets resist the attacks of the rest of the global markets?
Pay attention to U.S. Dollar after FED's Yellen congressional testimony this Wednesday and federal budget this afternoon at 2 p.m.
Dear traders and investors, fear is in the air, the trend shifted to the downside in the long run. What we risk is a bear market. S&P and DJIA are fighting in good supports, if they work well the trigger for an up leg is almost ready. But if they failed the bear market is going to be alive. I agree that a purge of stock prices will be beneficial for the financial markets and new buyers.

Good luck, viel Glueck, buona fortuna, buena suerte, bonne chance!
Ulises

Failed first attempt to the upside

DJ Resistance:  18,351      All-time high
                        18,206      Breakout
                        18,104      2014 peak
                        17,978      November peak
                        17,810
                        17,579      Inflection point
                        17,391      200 Days moving average
                        17,125      Old support
                        17,050      Old strong support
                        16,933.43  September peak
                        16,667      Important for next up leg
                        16,410
                        16,232

DJ Support:     15,980      Strong
                        15,842
                        15,450      January low
                        15,370.33 2015 low very strong

Technical Analysis:
DJIA did a big upside attempt last week especially on Friday after Bank of Japan negative interest rates policy. The attempt didn't have a follow through, it was a dead cat bounce. DJ16,667 is a very important resistance, the index has to sleep over it to think about the pending repairs of charts. This breakout would be or considered a technical advance for the bulls and would trigger a potential upside move.
DJ15,980 and 15,450 should be strong supports.
The trend has shifted to bearish-leaning for the long term.

Please click over the charts to enlarge them.

Fundamentals:
As I explained last week the market blamed China for failling oil prices. But if we see the China oil imports in 2014 it was 3,000,000,000 barrels and in 2015 3,351,000,000 barrels. That means 10% more barrels were imported in 2015 than 2014. The oil problem is on the supply side, Saudi Arabia and OPEC are the bigger suppliers and they are supplying.
Market is correlating oil prices with stocks, when oil prices go down stocks prices also go down. That could be true in the last weeks but certainly there is not correlation between them, for that it is enough to see a chart with the prices from January 2014 to January 2016.
I would like to tell you what is going to happen with the stock market this 2016 but I am not a magician. I pick up information and process it to determine the path of the stock market but currently I find so much confusion.
The market has have a big swing during January, 12% to the downside and a bounce up of 7% in the S&P. I expect more of these swings.
Dear traders and investors, fear is what is driven the stock market, that is the reason why stock prices seem to follow oil prices.

Good luck, viel Glueck, buona fortuna, buena suerte, bonne chance!
Ulises