As I said earlier, the odds for higher prices over the next 5 sessions have increased after Friday, the majority of the stocks are near their ST cyclical lows timewise and most of the prices managed to stay near the lower channels. They can slip lower some more, my pattern matches from June 12 were actually calling for the lower prices here, but the lows has to come quickly from here and I don't think there is enough time for a big decline. So, given the larger trend, I think a low will come sooner than later. Any sell off needs to be very strong to break the trend here and there is not even enough speculation...
For the IT, the sector leadership in the tech, industrials and energy say there is enough strength to pull forward and actually we might get a strong rally, if a sell off happens early next week. I see RUT and NDX outperforming since June 12 low and it means the participants are still willing to take the risk. I don't expect the banks to do much since the direction of the rates is clear...
The market's energy is generally increasing in my analysis for the short term, so it can undershoot the channels and it is not very strong for the intermediate term for the summer, however these levels are not where the long term failures should happen yet, imho. So, I will rather look to buy escapes below the channels in the weeks ahead until a clearer picture emerges...
Here, I tried to break down my signals into smaller timeframes, unfortunately there is quite a bit noise and less clarity. I think the dealers see enough buying interest and borrowed to buy more for their clients, the level of borrowing is very high and it confirms that a big decline should not come out of the current setup either. So, this only leaves one direction for the market; UP, eventually.
Good luck,
- kisa