Is the NYA trying to break out?

Last week I showed the two important bull/bear levels to watch on the NYA. See here. This week price climbed higher into Friday and looks ready to break out, but will it?

Below is a chart of the NYA; from a trendline S/R perspective as the NYA has been unable to move much higher over the past 10 months; since early July 2014! The purple S/R lines show how price was held in check, and was never able to move above these lines, but for a few days. However, in the far right we can see Friday’s candle and that price has now been able to move above all of these purple S/R lines. And what once was resistance may now become support.

  

Since there’s never a complete bullish or bearish picture to a market, we must note –as to remain objective and factual – that two shorter term (blue) trendlines are still above price, and the NYA hit the lowest one exactly and was unable to break above it on Friday. Please also note the white and yellow uptrend channel lines. The former are in place since early 2012, while the latter are since the price low (Primary II) made in 2011. Hence, price remains in an uptrend. 

  

The chart above zooms in on the past few months and shows the preferred wave count for the NYA in more detail.  As you can see, price keeps moving up in impulsive (5) waves and moving down in corrective (3) waves. Please note the picture perfect 5 waves for orange micro wave 1, and then the picture perfect 3 waves down for micro 2. For example, nano iv of micro 1 bottomed at NYA 11010, while nano i peaked at 11009: no overlap and thus an impulse wave. The alternate count is that minute i and ii and micro 1 are a, b, and c waves of a larger irregular flat minute ii wave. This would mean that price should swiftly drop below what is labelled here as minute ii. 

However, the daily TIs suggest otherwise with several TIs coming of off oversold levels and producing perfect buy signals (e.g. The FSTO) and the positive divergence between price and the RSI5 (Wednesday’s low vs the April 30th low) setting up the rally over the last 2 trading days. See chart below.

  

Also note how on Friday the daily SAR flipped back under price, signaling a new shorter term uptrend, while the upper Bollinger Band started to expand, showing price has upward strength. As mentioned earlier, also longer term the trend remains up, and the weekly chart below shows this, with the SAR below price and price finding continued support at the 20w SMA, while the weekly MACD keeps pointing up. As do the other TIs.

  

Last but not least, NYMO dipped below the -60 level on Wednesday, which in this bull market since 2009 (only last 1 year shown for clarity) has coincided with what I call a buy-able bottom level. However, the Bulls don’t have the all clear yet as NYMO is still negative.

  

 

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