I've arrived home and will complete my travel diary for you all tomorrow. I have just enough energy to finish up the Alert! I studied price action and I realized that you could make a case for an ascending triangle which is a bullish formation. Yet, indicators have been soft and a trading range still makes the most sense to me. Of course, indicators are beginning to improve in the shorter term. At this point, it could go either way. Here's why...
DP INDEX SCOREBOARDS:
TODAY'S Broad Market Action:
One 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: BUY as of 6/8/2020
SPY Daily Chart: Gap resistance remains strong. While the PMO is getting ready for a BUY signal, we now have a negative divergence between price and the OBV in the very short term. We have declining tops on the OBV and rising ones on price.
Climactic Market Indicators: Readings were somewhat climactic to the positive side which could indicate a rally pop in the next day or so. The VIX is back above its moving average on the inverted scale, but the Bollinger Bands are beginning to squeeze. This is a characteristic we usually see in a consolidation phase or steady rising trend. The problem is when they begin to expand.
Short-Term Market Indicators: The short-term market trend is UP and the condition is NEUTRAL. Based upon the STO ranges, market bias is BULLISH. The STOs are rising now, but we still have the negative divergences that should resolve with further downside. I will roll with the rising STOs and consider these mostly bullish right now.
Intermediate-Term Market Indicators: The Silver Cross Index (% of SPX stocks 20EMA > 50EMA) and Golden Cross Index (% of SPX stocks 50EMA > 200EMA) turned higher today which is bullish. This is accompanied by a BPI that had a positive crossover.
The intermediate-term market trend is UP and the condition is BULLISH. With most of the ITBM/ITVM readings since the end of April being above the zero lines, the market bias is BULLISH. PMO Crossover BUY signals are continuing to rise and improve and that is now joined by rising ITBM/ITVM.
CONCLUSION: My sense is that we will continue into this trading range. The indicators are starting to improve and that bodes well for a rally this week. Indicators are bullish, but I'm not so sure it is enough to push price into that strong gap resistance area.
IT Trend Model: NEUTRAL as of 5/28/2020
LT Trend Model: SELL as of 7/10/2020
UUP Daily Chart: Yesterday's comments still apply with this addition:
"Friday the Dollar triggered a LT Trend Model SELL signal as the 50-EMA crossed below the 200-EMA. The PMO is triggered a crossover SELL signal. The double-top isn't textbook as they are reversal patterns, but it looks pretty bearish to me. I've been waiting for a breakdown below support at $26 and I still think I'll get it."
IT Trend Model: BUY as of 3/24/2020
LT Trend Model: BUY as of 1/8/2019
GOLD Daily Chart: Gold tapped below the rising bottoms trendline, but closed above it to form a 'hammer-like' OHLC bar (price closed near the high for the day after dipping lower). These are bullish candlesticks. Given the rising PMO, positive RSI and discounts on PHYS, I'm still bullish on Gold.
GOLD MINERS Golden and Silver Cross Indexes: I was pleased that Miners righted the ship today and kept me from having to sell my NEM stock. If it continues to hold the 20-EMA, I like them still. Notice the strength of the components based on the Silver Cross, Golden Cross and many stocks above their 20/50/200-EMAs. Those numbers generally will keep a rally going.
CRUDE OIL ($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: Yesterday's comments still apply:
"Price has been unable to break above $42. The 200-EMA is posing stout resistance. The RSI is trending lower now and the PMO has yet to turn up so I'm not expecting a breakout yet."
IT Trend Model: BUY as of 6/26/2020
LT Trend Model: BUY as of 1/2/2019
TLT Daily Chart: Yesterday's comments still apply:
"Bonds are remaining in a rising trend and the RSI is quite healthy. I would look for a challenge of overhead resistance around $170."
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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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