Two new IT BUY signals have arrived. The NDX picked up a weekly PMO BUY signal after the close on Friday when the chart went "final". After a deep bear market decline, the NDX and technology in general have been holding up and in many cases, clearly outperforming the market. I've annotated the NDX weekly chart below. "V" market bottoms generally will see a continuation past the left top of the "V".
The SPX took until today to pick up its new IT Trend Model BUY signal as the "silver cross" of the 20/50-EMAs didn't occur until today. The SPY picked up the new BUY signal on Friday which Carl did write about in his Weekly Wrap. We use the SPY to track our signals with Timer Digest so we logged the BUY signal on Friday.
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: The market ended mostly unchanged today. The OBV bottoms are rising in the short term to confirm the current rally. However, I'm not a fan of total volume declining on a short-term rally.
Climactic Market Indicators: No climactic readings today, but I do note the VIX continues to flirt with a break through the upper Bollinger Band on the inverse scale. That is typically an informal very short-term 'sell signal'.
Short-Term Market Indicators: The ST trend is UP and the market condition is NEUTRAL based upon the Swenlin Trading Oscillator (STO) readings. I don't like seeing the drops in %stocks above 20-EMA and PMO Rising dropping. The STOs decelerated a bit today, but they are still rising and are not overbought. As I said, I have been putting my trust in the STOs. They continue to rise, so I will continue to look for the current short-term rising trend channel to hold up a bit longer.
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 both rising. The BPI has flattened before a positive crossover which does seem suspect.
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The IT trend is UP and the market condition is NEUTRAL based upon the ITBM and ITVM. Both of these indicators are now back above their signal lines. Their enthusiasm is lacking, but location is good. Crossover BUY signals are rising slightly and that's positive.
CONCLUSION: The ST is UP and IT trend is also UP. Market condition based on ST indicators and IT indicators is NEUTRAL. Overall the indicators are bullishly rising. There are few that aren't and any time the market condition is "neutral" you should think caution. The new IT BUY signals are great to see, but many times they arrive late to the party given indicators based on moving averages do lag. I'm watching my stop levels and continue to be 80% invested.
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IT Trend Model: BUY as of 3/12/2020
LT Trend Model: BUY as of 5/25/2018
UUP Daily Chart: UUP is ready to mock me again with my chart pattern discernment, but currently, the bearish descending triangle makes the most sense. The PMO is now getting oversold and has turned up. I won't get completely bullish until we see not only a break from the declining tops trendline, but a breakout above the April top. For now, it seems happy to bounce around in this trading range.
IT Trend Model: BUY as of 12/26/2019
LT Trend Model: BUY as of 1/8/2019
GOLD Daily Chart: The symmetrical triangle is still valid. The expectation of this continuation pattern is an upside breakout given the rising trend it was in before the formation of the pattern. The PMO doesn't support the thesis of an upside breakout, but I do find it bullish that it is decompressing and moving out of overbought territory without any major price deterioration (rising price lows).
GOLD MINERS Golden and Silver Cross Indexes: Miners were due for a pullback, but the rising trend hasn't been broken. I would consider pullbacks in the miners to be possible entries. The BPI is on the overbought side, but the SCI and GCI still look positive and have certainly seen higher readings.
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: I still see a reverse island on Oil. The 50-EMA is posing considerable overhead resistance. The PMO is flying higher, but given the 23%+ move on Oil in the past week, I would expect nothing less. Overall I don't like this area of the market. The supply and demand issues need to clear up before I see it as attractive and who knows how long that will be given the plethora of supply.
IT Trend Model: BUY as of 1/22/2020
LT Trend Model: BUY as of 1/2/2019
TLT Daily Chart: I haven't given up on the bearish double-top. Today price closed beneath the April low, but at this point I think we need to see a more decisive breakdown of 3% or more before we can count TLT out. The 50-EMA so far is holding as support.
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Technical Analysis is a windsock, not a crystal ball.
Happy Charting! - Erin
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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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