I was wondering if my eyes were deceiving me regarding a short-term rising trend channel. Using the annotation tool, I copied the rising bottoms trendline and dragged it up to see if it matched up to the rising tops. Sure enough it did! I am not convinced this is going to carry price through May, but for now it does look promising. I would have liked to have seem much higher volume on a day where the SPY was up 1.21%. The VIX is also overbought on the inverted scale (although it is weird to say a reading above 30 is overbought!).
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: NEUTRAL as of 2/28/2020
LT Trend Model: SELL as of 3/19/2020
SPY Daily Chart: So technically we did see the rising wedge resolve downward, but very quickly price began to rebound once again off the 20-EMA. We are very close to getting an IT Trend Model BUY signal as the 20-EMA is just about ready to have a "silver cross" above the 50-EMA. The PMO is mostly flat but not yet declining. The OBV negative divergence likely resolved with the breakdown out of the wedge.
Climactic Market Indicators: I don't think we have climactic readings right now, but I am noticing a rising trend now on the Net A-Ds. Combined with the rising trend channel, it does have a bullish bias. The VIX is close to touching the upper Bollinger Band though and that typically is a very near-term sell signal. We don't have it yet, so maybe we can eke out a gain tomorrow.
Short-Term Market Indicators: The ST trend is UP and the market condition is SOMEWHAT OVERSOLD based upon the Swenlin Trading Oscillator (STO) readings. Okay, the STOs ticked up today. I finding that to be a good indicator we could see a follow-on rally or simply a sign that the rising trend channel might hold up.
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 GCI and SCI are still rising which is positive. Additionally the BPI has ticked back up just like the STOs.
The IT trend is UP and the market condition is NEUTRAL based upon the ITBM and ITVM. Hmmmm, the ITBM is so far avoiding a negative crossover which gives some comfort, but at this point, they are declining and that is bearish for the intermediate term.
CONCLUSION: The ST is UP and IT trend is also UP. Market condition based on ST indicators is SOMEWHAT OVERSOLD and on IT indicators is NEUTRAL. The short-term picture is starting to look more bullish, but I know there are deep problems that have not been resolved as far as the virus. I remain 80% in the market right now, but I have tightened stops and am contemplating taking some profit on a handful of my positions.
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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: Alright! I may finally have gotten to the right chart pattern on UUP. Price hit the declining tops trendline that makes up the top of the descending triangle. Expectation is a breakdown. The PMO turned lower today.
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 might be turning back up along with the RSI which is bullish.
GOLD MINERS Golden and Silver Cross Indexes: Well so much for pausing and digesting Tuesday's rally. Gold Miners basically took back the losses from yesterday and broke out. I'm still a bit nervous about the PMO topping, but it is hard to argue with this kind of internal strength.
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 see a reverse island on Oil. I suspect we will see the gap from Tuesday close soon. Profit taking is likely occurring. I don't see any future big changes in supply and demand. I get the sense that this was a bottom fishers' rally that is beginning to wane. I suspect once the gap is closed it will turn back up off support at around $20.
IT Trend Model: BUY as of 1/22/2020
LT Trend Model: BUY as of 1/2/2019
TLT Daily Chart: So much for the double-top executing yesterday. Bonds rallied strongly today. The short-term declining tops trendline is still there in the thumbnail so I'm not giving up on this pattern just yet, especially given the negative PMO.
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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.
Helpful DecisionPoint Links (Can Be Found on DecisionPoint.com Links Page):
DecisionPoint Shared ChartList and DecisionPoint Chart Gallery
Price Momentum Oscillator (PMO)
Swenlin Trading Oscillators (STO-B and STO-V)