There are many ways you could draw this rising wedge: off the lows/highs, touching as many points as possible, or as few as possible, or alternatively use the close only chart. You get my difficulty? If we take the Friday’s low as the lower part of the wedge, then we have not yet broken the wedge…
CHART OF SPY
… if we draw using the close-only chart, then the wedge looks like it was broken on Thursday.
CLOSE ONLY CHART OF SPY
​

NYSE composite chart is showing a potential failure at the 200-day moving average. The price touched it last Friday and bounced back all this week. An important test would be to see if $NYA can now quickly reverse the losses and rally above the 200-day. If not, and price is again rejected, we could finally see the general markets roll-over and head for a retest of multi-year lows set in February. Failure there would be very bearish.
         Market breadth did improve significantly from the beginning of the year. Specifically the AD-Line and the Bullish Percent indices for $NYA are now in the bullish territory. But as I have been pointing out, the volume has been lacking on this rally and the percent of stocks above the 200-day exponential moving average for $NYA is still below 50%. This needs to improve further for me to even contemplate a switch in posture from bearish to bullish.  
CHART OF $NYA
​

​Many of the market commentators are quite rosy about the outlook for the stock market. My long-term model (MBI) has flipped into the bear mode as early as September of last year and is yet to even begin improving. This could all change at any time.

If, as many commentators point out, the picture is rosy, why then are bonds hitting all-time highs, as stocks struggle? In fact, diversified bond fund, AGG, just hit an all-time high this week. In my opinion this is showing elevated levels of fear, as investors are jockeying to get into position to prepare for more downside in stocks.
CHART OF AGG
         Long-term AGG is looking rather bullish too. From the chart patterns I can see that AGG could easily move up around 3% or more. Should this come to pass, it would be rather bearish for stocks.
LONG-TERM CHART OF AGG
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The Dollar strengthened against many other currencies, especially the Yen and the Euro. This put some serious pressure on the commodities complex and called into question gold and oil’s short-term uptrends.
CHART OF $USD
         Long-term $USD needs to break out above 100 or break down below 92 to clarify the picture. A breakout would pressure commodities very strongly, while the breakdown, would help them, gold especially.       
LONG-TERM CHART OF $USD
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Strength in dollar is weighing on gold. On Thursday gold may have broken a minor support at around $1226 and so far was not able to recapture. Last week I mentioned that my long-term gold model (GBI) has flipped into a bull market and I am now looking to buy gold and to trade it on the upside.
LONG-TERM CHART OF GOLD
         This pullback, which is looking like it is going to materialize, is going to be an important test of the validity of this breakout. A failure in the $1800 area, could give way to a trip down to the $1100 area. A failure there may mean that this breakout has failed completely and we would be back to our regularly scheduled bear market in gold.
GOLD CHART
         Gold miners are following gold lower over the last two days, but in their usual volatile manner. There are now multiple unfilled gaps on GDX chart. The big question remains which once will get filled first? If gold pulls back, it could be the once down below around $15.5 or even around $13.50. As you can imagine a gap fill in the $13 are would pretty much imply a complete failure of the new bull market in gold.
CHART OF GDX

Oil was also rising in a wedge-like pattern together with stocks. Oil has been highly correlated to the stock market of late. I think it’s a spurious correlation, but robots do pay attention to these short-term correlations, so we should heed them as well. As with my SPY example above, it is sometimes difficult to draw trend lines. This is why chart patterns are secondary in my analysis and I pay more heed to the quantifiable variables. There is also a possible rejection candle from last Friday’s action at the 200-day moving average. A close below this Thursday’s low would most likely break this pattern and we could see a trip down to multi-year lows again.
CHART OF $WTIC
​

Natural gas bounced back from multi-year lows in the beginning of March also in form of a possible rising wedge. NATGAS was able to pierce through some weak resistance at $1.90, but so far hasn’t been able to close above the 50-day moving average. I drew in several resistance levels around 2.15, 2.35 and 2.50.  
CHART OF NATGAS
         The 2.50 level is of a particular importance because it is around there that NATGAS failed last September. It is also around 2.50 where the price was rejected in January. Currently there several bullish divergences present on the long-term chart of NATGAS (price made a lower low, but indicators made higher lows).
         As of the writing of this blog post, I still consider NATGAS a bearish security and by extension only looking for short setups. Should NATGAS manage to break above 2.50 and hold on a retest my posture would change to a bullish one.
LONG-TERM CHART OF NATGAS

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That’s it for this week’s market recap,
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Alexander Berger (www.MasterChartsTrading.com)

​My argument has been consistently that stocks are currently in a bear market and this rally off the 2-year lows in $SPX is a counter-trend rally. You may argue that rallies of these proportions do not happen during the bear markets. Nothing could be further from the truth!
CHART OF $SPX   

Take a look at the chart of $NYA from the beginning of the bear market back in 2001. Notice how $NYA made a low in March of 2001 and then rallied over 20% for 2 month! What happened afterwards? $NYA turned around and collapsed over 25% from May 2001 into September of 2001. This was all within a context of a bigger downtrend in stocks that incidentally was just getting started.
 
Currently we have a very similar picture as $NYA rallied almost 15% off the multi-year lows set in February. Can stocks continue higher? Absolutely! However within the context of the existing and ongoing bear market, stocks could easily roll over with a vengeance and break the January lows.
CHART OF $NYA
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trength in bonds should also be of a concern to the stock bulls. TLT made an all-time high in February and corrected into March. We might get some more back and forth with TLT, but an uptrend could resume soon. This will certainly come to pass if the stocks come under selling pressure going forward.      
CHART OF TLT
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I changed the long-term chart of TLT and there is a possibility of a cup and handle      being traced out there. This is a massive cup with a 20% depth of the pattern. Should it play out TLT could run quite a bit higher, with a projected price of about $160. Of course TLT running this much higher would mean stocks have came down quite a bit from today’s levels.
LONG-TERM TLT CHART
​Diversified bonds fund, AGG, hit all-time highs this Friday, but pulled back. New highs are very bullish and we could expect more highs in the not so distant future.
CHART OF AGG

​

 The Dollar pulled back for the third week in a row on the heels of losses versus both the Euro and the Yen. The Euro is trading in a sort of a range, but the safe-haven Yen seems to want to go higher, despite a massive intervention by the BOJ.
CHART OF $USD
          Long-term there could be a cup and handle on the chart of $USD, and a breakout above the 100 level would be quite bullish. An alternative scenario is a push lower to around 92, and a break below it. Should this breakdown occur, it could mean a pull of the $USD back to the 2014 breakout levels around 85.
LONG-TERM CHART OF $USD
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Weaker dollar is certainly helping various commodities, gold especially.
My long-term gold model (GBI) has flipped into a bullish mode.
I am now around 90% confident that a new bull market in gold has started. What does it mean in the near future? Currently gold is very overextended to the upside, but it can get even more overextended by pushing above the recent highs. I am not going to be chasing this “once in a blue moon" trend change, but will patiently wait for a pullback and look for bullish setups. Gold may take a few days, a few weeks or a few months to get there, but it will eventually get there. This is synonymous to waiting for the market to come to you and avoiding chasing the market. 
GOLD CHART
​​Even if gold did become bullish in the long-term, a retracement to the Fibonacci levels as pictured in the chart below is very likely. However now this could mean a buying opportunity, rather then a downside target.  
1-YEAR WEEKLY CHART OF GOLD    

Our friend GDX is of course following what gold is doing, but in its usual volatile fashion. GDX is up over 73% from its all-time low in January and is approaching 52-week high – all this in just two month! As with gold, I am now treating GDX as a bullish security and will be looking for buying opportunities.
CHART OF GDX

 Oil failed to break down this week and continued up within its rising wedge/channel. On Friday it basically touched the 200-day moving average and pulled back. Will this level act as resistance again, or will oil push higher on the heels of the weaker dollar?
CHART OF $WTIC
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NATGAS had another counter-trend rally off the multi-year lows. It ended the week just below the 50-day moving average. The chart also shows a slight bullish divergence between the spot price of NATGAS and the On Balance volume indicator. Multi-year lows in my book imply a strongly bearish case, so we will be looking to short again once this rally peters out.
CHART OF NATGAS
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Various agricultural commodities may also be showing signs of life. This is possibly due to the weaker dollar as well. Sugar is one such commodity and my subscribers are up over 20% being long SGG. Sugar just hit a 52-week high, and the chart looks quite bullish.
CHART OF SUGAR
​

 
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That’s it for this week’s market recap,
Best Regards and have another great trading week!
 
Alexander Berger (www.MasterChartsTrading.com)