Wyckoff Wave Bumping Its Head On The Ice

The Wyckoff Wave closed the week only slightly higher, on low volume.

We had expected the Wave to meet resistance at the previous support area, as the rally was on low volume and with an  overbought Technometer reading.

We would expect the Wave to continue to work lower in the coming week. 

The Technometer has backed off to a reading of 46.3.  

The Wave is leading the OP slightly. 

WWN – The Wyckoff Wave New Index was also up slightly for the week, but on low volume as well.   

We had mentioned that we could get early week strength back to the ice here as well.  This also was done on low volume and a near overbought Technometer.  We expect a pullback here as well next week.  

The Technometer is neutral with a reading of 44.6.  

The Wyckoff Wave Growth Index was slightly higher for the week on lower volume.  

The last three times we have become overbought this market has turned lower.   The overbought reading did stop the rally, lets see how much weakness it can now usher in.  We would expect at least a test of last week’s lows.

The Techometer is near neutral at 45.1.  

The SPY closed the week lower on low volume. 

The Technometer was extreme overbought which stopped the rally this week.  

As you can see at the blue arrow/dot, this is where the OP bottomed, which means this is where volume decided to turn higher.  This is shown by the blue line.  So as plus volume returned to the SPY, it took price only up to where it was when volume turned higher at the blue dot.  Which is at the same level, so no price gains while plus volume came into the market. 

Volume also increased on the decline as marked by the red line, while declining as prices rose as shown by the green line. All of the above, appears will usher in more selling next week.

We are still near overbought on the Technometer at 47.4.  

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The bond market closed lower last week on lower volume.

The Technometer was near oversold, and now back to overbought.   This market looks like it has still lower to go.  

The Technometer is overbought with a reading of 50.3. 

The GDX closed the week unchanged on low volume.

We had an overbought Technometer so we thought the upside was limited.   The Technometer has backed off to 42, so we expect prices to work lower next week, and possibly we could get a buy setup here on the GDX.   

The Technometer is nearing oversold at a reading of 42.3.  

The long dollar ETF, UUP closed the week slightly higher on a slight increase in volume.

We have had some sideways price action with no gains after an oversold Technometer.  We are now back at overbought, so we think this market will probe the downside again in the weeks ahead.   

The Technometer is near overbought with a reading of 48.  

Bitcoin has traded net sideways in the last week after giving up the strong gains from Monday.  

We had thought stocks/crypto could see some selling after early week gains, and that is what we saw.

Interestingly now, the Technometer for Bitcoin has came quickly down to oversold.  You can see that on the chart the OP has hit continued new lows since May 10th, while price has held higher.   This is selling that is being absorbed by what is normally more intelligent buyers.  

Our Technometer for Bitcoin is oversold with a reading of 37.3.

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Todd Butterfield