The 10-minute bar chart is interesting today as it tells two tales. It's a "good news, bad news" picture. Everyone likes to start with the "bad news" first. Price broke down to finish the day. It lost the rising trend and then broke below today's support level around 2940. The PMO topped out yesterday and failed to get back above its signal line today. This all occurred on high volume, check out the drop on the OBV. The good news? Well, gap support is available. Best case would be a reversal at the top of the gap, next best case would occur if the gap closed and price bounced after the closure. Unfortunately it is typical when a gap closes that price will continue in the direction that closed that gap. In this case, it would be lower.
TODAY'S Broad Market Action:
Past WEEK Results:
Top 10 from ETF Tracker:
Bottom 10 from ETF Tracker:
On Friday, the DecisionPoint Alert Weekly Wrap presents an assessment of the trend and condition of the stock market (S&P 500), the U.S. Dollar, Gold, Crude Oil, and Bonds. Monday through Thursday the DecisionPoint Alert daily report is abbreviated and covers changes for the day.
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Each S&P 500 Index component stock is assigned to one, and only one, of 11 major sectors. This is a snapshot of the Intermediate-Term (Silver Cross) and Long-Term (Golden Cross) Trend Model signal status for those sectors.
One WEEK Results:
IT Trend Model: BUY as of 5/8/2020
LT Trend Model: SELL as of 3/19/2020
SPY Daily Chart: Price failed to make a higher high today and was stopped at overhead resistance. The PMO is flattening, but still technically rising.
Climactic Market Indicators: We have somewhat climactic reading to the negative side today. The VIX topped before reaching the upper Bollinger Band on the inverted scale. This typically leads to a decline or at best, consolidation. What looked like a solid buying initiation yesterday is now looking more like a buying exhaustion. The one positive on the chart is that total volume was lower on today's decline versus yesterday's high volume on the gap up.
Short-Term Market Indicators: The ST trend is MIXED and the market condition is NEUTRAL based upon the Swenlin Trading Oscillator (STO) readings. The STOs are rising with no hesitation yet. Unfortunately they are accompanied by topping %Stocks indicators that were in overbought territory. The SPY could be setting up an island reversal. That would mean a gap back down that would form an island out of price action yesterday and today.
Intermediate-Term Market Indicators: The Silver Cross Index (% of SPX stocks 20EMA > 50EMA) and the Golden Cross Index (percent of SPX stocks 50EMA > 200EMA) are rising. The GCI accelerated higher today which is good for the longer term. The SCI bottomed above its signal line or 10-EMA which is also positive.
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The IT trend is UP and the market condition is NEUTRAL based upon the ITBM and ITVM. I noted yesterday that we've seen these indicators fail to hold "ticks up" and today that failure occurred. Both the ITBM and ITVM topped below their signal lines which I find especially bearish for the intermediate term.
CONCLUSION: The ST trend is MIXED and IT trend is UP. Market condition based on ST indicators and IT indicators is NEUTRAL. Yesterday the indicators were far more bullish. The STOs are still rising, but price action and other indicators aren't flashing bullish. I would look for consolidation as best case. I wouldn't be surprised to see that island with a gap down tomorrow. I was stopped out of another position today, but entered two new ones. I meticulously went through each of my positions' charts and set up tighter hard stops and then set price alerts for my targets being reached.
IT Trend Model: BUY as of 3/12/2020
LT Trend Model: BUY as of 5/25/2018
UUP Daily Chart: Price didn't make it to the top of the trading range before breaking down. This suggests that price will at least come down and test the bottom of the range. The PMO SELL signal tells me it likely won't stop there, but continue lower.
IT Trend Model: BUY as of 12/26/2019
LT Trend Model: BUY as of 1/8/2019
GOLD Daily Chart: Gold rallied today and turned the PMO back up. I like gold on the breakout from a possible bullish pennant on a flagpole. If the Dollar breaks down as I expect it to, that will help Gold possibly breakout above the April top.
GOLD MINERS Golden and Silver Cross Indexes: What's not to like about Gold Miners? In my opinion only one thing--the BPI downside crossover. However, I still like Miners. I'm hoping they will test that short-term support again so I can get into some of my favorites like GOLD and NEM, they continue to look good.
CRUDE OIL ($WTIC)
The oil market is under severe pressure due to a lack of demand, and we do not believe that USO is an appropriate investment vehicle at this time. Until further notice we will use $WTIC to track the oil market. Since this is a continuous contract dataset, it doesn't "play well" with our Trend Models, and we will not report Trend Model signals for oil.
$WTIC Daily Chart: Oil was up nearly 1% today. The PMO looks strong and I see a bullish flag that executed. $35 seems to be the moment of truth level.
IT Trend Model: BUY as of 1/22/2020
LT Trend Model: BUY as of 1/2/2019
TLT Daily Chart: TLT had a nice rebound off support and the 50-EMA. I do note that this support line could also be the neckline for a bearish head and shoulders pattern. That neckline needs to hold.
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NOTE: The signal status reported herein is based upon mechanical trading model signals, specifically, the DecisionPoint Trend Model. They define the implied bias of the price index based upon moving average relationships, but they do not necessarily call for a specific action. They are information flags that should prompt chart review. Further, they do not call for continuous buying or selling during the life of the signal. For example, a BUY signal will probably (but not necessarily) return the best results if action is taken soon after the signal is generated. Additional opportunities for buying may be found as price zigzags higher, but the trader must look for optimum entry points. Conversely, exit points to preserve gains (or minimize losses) may be evident before the model mechanically closes the signal.
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