It would be best if you’ll click the chart and blow it up to its full size. It’s fairly huge and it’s fun to look at.
This chart was produced last year in NFTRH as MACD was rounding into a topping situation. What I found interesting was that in the last two instances (Humps 1 & 2) a down-triggered monthly MACD served to drop SPX to the EMA 20, providing the refreshment that gave fuel to the dynamic final upside for the stock market as the ultimate down-trigger and liquidation came well over a year later and from a much higher price.
What is different this time is that price has not done squat (save for the hard stab down during last October’s flash correction and reversal), doing all it can do to touch the EMA 10 while MACD makes a stronger looking initial bearish signal than it did on the two previous cycles.
The way I interpret it is that in resisting any price destruction while MACD continues to roll it is probably a good idea to view 2000 and 2007 as cool comps but to realize this thing, built by will of man (and woman) per the chart below, is its own animal fully capable of attaining its targets, which once seemed ridiculous, or imploding for a test of major support or worse.
Humps 1 & 2 were attended by at least some semblance of monetary stewardship. Hump #3? Not so much.
So our post concludes, hey SPX can either rise a long way or drop a long way. Sounds about right because we are in uncharted territory. But as it stands now, that is an ugly looking MACD.
DOW has reached initial resistance with bounce target #1 about 100 points higher.
Continue reading NFTRH; US Market Bounce Progress
The Russell 2000 obviously has an ugly topping pattern. It has long since nudged to a lower low to the August low and now has eased below March and January. If it holds below the line this thing will be in a bear trend. The bears should hope that TA geniuses do not come out and blow horn the DEATH CROSS!!! of the MA’s 50 and 200, which is a Red Herring. The chart is bearish enough without the help of that hype.
Anyway, RUT was a leader to the upside on this most intense bull market phase, which has been the post-2012 period and that leader is starting to lose its bull market.
Continue reading Market Leaders Abdicating
Well, here came the short covering rally in the precious metals. By calling it that I don’t mean that it cannot turn into something more, but today was most assuredly driven by short covering as the US dollar unwound some of its speculative sponsorship. One can assume that large speculators took it on the chin on both ends, in the USD and in gold/silver as the Commercial traders had been aligned increasingly bearish and bullish, respectively.
Continue reading NFTRH; Multi-Market Update
Updating the charts we have used to gauge October’s little bearish ripple and projected bounce back.
Continue reading NFTRH; INDU, SPX & NDX Updated
A brief update on the headline US markets, namely the Dow, S&P 500 and Nasdaq 100.
Beginning with the latter, we note that Mark Hulbert’s Nasdaq newsletter writer sentiment data shows a very bearish sentiment profile, which is contrarian bullish.
Continue reading NFTRH; INDU, SPX & NDX Status
For those of you keeping score at home, the S&P 500 tapped the SMA 50 and still resides below resistance. A rise above 1980 neuters the good bear work to this point. A hold below it, not so much.
Gold stocks are down again today and it is now decision time (for the sector if not individuals). That is because the parameter is to not make and hold a new low to the May low on a closing basis. We noted that a bounce is possible and if it is going to happen it should happen around here, at the May low with a similar over sold RSI. Either that or it would be broken with a lower low (that does not reverse quickly).
Continue reading NFTRH; Multi Market Update
While we have been charting a constructive gold vs. commodities big picture view, we have also kept track of a disgusting gold vs. SPX big picture view as gold has been “boxed in” as it grinds around looking to close the gap from 2007. That was the kickoff to the financial crisis as the first institutions began melting down.
This cycle really has done amazing work in repairing (some, including myself would say sweeping under the rug) the damage and resetting the gold bug psyche as well. It is important to remember that gold bugs were the kings of everything back then, with their ideology unquestioned. But these are the markets and they don’t care about egos. Actually yes they do, they care about crushing inflated ones. The job appears to be in its final stages.
Okay, here’s the last one of these short-term casino patron updates. I’ve got more important things to keep track of like that short against DSLV, which is testing its limits this morning. SPX 60 minute view…
- Initial objective (targeted back when the average bull was supposedly worrying about Ukraine and Russia) of 1950-1960 (resistance, now tentative support) is in the books.
- Gap is filled.
- Pattern measurement still resides above.
- Typical of these rallies off of bull market corrections, they tend to test to the will of bears so that even those with the most conviction that this is finally the big one, will have a good amount of doubt, Soros Put position or not.
- I have no such conviction, and instead resolve to go with what the market says.