Back in January 2017, I wrote about the Chinese New Year’s Astrological sign of the Fire Rooster.

At the time, I reported that “Yin fire is still positive for the economy and the optimism continues to bring confidence to buy, particularly in spring and summer time when the candle flame gains seasonal support and drives up the illusory optimism.”

However, I went on to write, “as the yin fire is an illusory candle flame, it will be extinguished by autumn and winter.

So, there will be serious setbacks towards August and October. This will bring a long-term bearish market as there is no more fire years before Tiger year 2022.”

I’m certain some of you are shaking your heads thinking, really?

Or perhaps you are thinking that August is typically a tough month which minimizes the astrological prediction.

Maybe still, some of you think that collective consciousness (4.436 billion Asians in the world as of 2016 consensus) has something to do with this correction.

Want to know what I think?

The rest of the astrological analysis says, “There is still conflict and disharmony in international relationships and it may not be a peaceful year.

But people are optimistic, open-minded, confident and innovative to bring solutions to obstacles.”

The weekly chart illustrates that sentiment precisely. Given the disharmony in international relationships, we see the Modern Family in decline.

Yet, all except the Retail (XRT) brick and mortar sector remain in bullish phases on the weekly timeframe. (Not so on the daily).

The dotted line is the 50-week moving average. Note that the slopes (again with the XRT exception) are positive.

The weekly charts suggest that optimism, confidence, and innovation for solutions prevail.

But for how long?

If you use the 50-week MA as a guide, then it’s possible the Modern Family can head into a weak warning phase and then bounce.

Also possible is that the 50-WMA acts as support and the market bounces from there.

What we will look for before claiming a “top”, is a price break below the 50-WMA with the slopes neutralizing to pointing south.

Then, should our Rooster’s fire burn out, (and maybe that happens in October or in early winter), we will plan for the end of the illusory candlelight.

S&P 500 (SPY) 245.68 resistance. Unconfirmed warning phase making 244.56 pivotal

Russell 2000 (IWM) 134 in focus with 136.20 the 200-DMA that might hold

Dow (DIA) Only index not in warning. 219.74 pivotal resistance

Nasdaq (QQQ) 141.44 the 50-DMA as this goes into an unconfirmed warning phase

KRE (Regional Banks) Unconfirmed distribution phase with 54.00 major resistance. 51-52 support

SMH (Semiconductors) the 50 DMA at 85.60 now resistance as this is in an unconfirmed warning phase

IYT (Transportation) 164.75 the 200 DMA no pivotal as this goes into an unconfirmed distribution phase

IBB (Biotechnology) 308.50 pivotal resistance with this now in an unconfirmed warning phase

XRT (Retail) Unconfirmed bearish phase-no surprise considering the weak get weaker

IYR (Real Estate) 79.50 pivotal with next support at 78.20

XLU (Utilities) 53.74 support to hold

GLD (Gold Trust) 123.31 last swing high resistance with 121 support

SLV (Silver) Could not quite clear the 200-DMA

GDX (Gold Miners) Through 23.10 clears recent resistance

USO (US Oil Fund) No reason to get in now until it changes phases on a weekly basis

TAN (Solar Energy) If gets down near 20.00-a gift

TLT (iShares 20+ Year Treasuries) Confirmed bullish phase.

VXX (Volatility Index) fear back in the market-13.68 the 6-month July Calendar Range high

UUP (Dollar Bull) 24.20 pivotal number

FXI (China) Possible exhaustion gap top if cannot get back to 43.20