The hype today was on the Nasdaq which hit a new all-time high for the 31st time this year according to my favorite closer, Liz Claman on FBN. However, very quietly, the S&P 100 (OEX) hit its first all-time high since February. This came on a breakout from a bearish rising wedge and a new PMO crossover BUY signal. The SPX is getting very close to new all-time highs as well. With the NDX and OEX lighting the way, I expect we will see new all-time highs very soon.
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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: Nice breakout on the SPY today. It now appears that instead of an island reversal, we had a breakaway gap. I suspect this one is a continuation gap. The bearish rising wedge isn't completely out of our hair, but today's breakout tells me we could be looking at a bullish conclusion to a bearish pattern which is especially bullish. The PMO is rising nicely after a crossover BUY signal yesterday. Volume is about the same.
Climactic Market Indicators: We still don't have climactic numbers. What we need to watch for would be highly climactic positive numbers that could be a lead in for a buying exhaustion. For now, all is well. The VIX remains above its moving average which gives us a bullish bias in the very short-term.
Short-Term Market Indicators: The short-term market trend is UP and the condition is NEUTRAL. Based upon the STO ranges, market bias is NEUTRAL. STOs were somewhat mixed as the STO-B moved slightly lower and the STO-V moved higher. I'm not thrilled with that, but they are on the positive side above zero. The negative divergences persist on the %Stocks indicators which are nagging me. They could avoid the divergence if they can get past their previous high.
Intermediate-Term Market Indicators: The following chart uses different methodologies for objectively showing the depth and trend of participation for intermediate- and long-term time frames.
- The Silver Cross Index (SCI) shows the percentage of SPX stocks on IT Trend Model BUY signals (20-EMA > 50-EMA).
- The Golden Cross Index (GCI) shows the percentage of SPX stocks on LT Trend Model BUY signals (50-EMA > 200-EMA).
- The Bullish Percent Index (BPI shows the percentage of SPX stocks on Point & Figure BUY signals.
The SCI and GCI are rising and positive. The BPI just whipsawed back above its signal line which is bullish; however, a look in the thumbnail shows me a new negative divergence between the previous price top and higher price top today versus the declining tops on the BPI. Again, that could be averted if the BPI can rise above the two previous tops.
The intermediate-term market trend is UP and the condition is OVERBOUGHT. With most of the ITBM/ITVM readings since the end of April being above the zero lines, the market bias is BULLISH. Both indicators rose today which is positive. However, the negative divergence is still there.
CONCLUSION: The bullish bias wins out as price gapped up again, hopefully forming a continuation gap and not a new island. Based on the mostly positive indicators, I'll stay bullish going into tomorrow and next week. We'll see how I feel Monday night.
IT Trend Model: NEUTRAL as of 5/28/2020
LT Trend Model: SELL as of 7/10/2020
UUP Daily Chart: Price gapped down again for the Dollar (UUP). The RSI is very oversold and the PMO is considering a possible bottom. It could be an island reversal, but with more money printing ahead, I suspect this is a breakaway or runaway gap.
IT Trend Model: BUY as of 3/24/2020
LT Trend Model: BUY as of 1/8/2019
GOLD Daily Chart: Gold is continues to soar and with the demise of the Dollar, I don't think it is done. Carl has been pointing to the continued discounts on PHYS. The public hasn't caught on yet or are possibly waiting for a pullback. We certainly could see that but with the hurricane force winds of the Dollar behind it, I believe we are going to see higher prices. A pullback is certainly in order, but for now it is happy to maintain this somewhat steep rising bottoms trendline.
Full Disclosure: I own GLD long-term.
GOLD MINERS Golden and Silver Cross Indexes: We didn't see a pullback exactly, but we definitely saw a pause. I like both Silver and Gold right now and will be looking into a Diamond I presented about a month ago, Wheaten Precious Metals (WPM) for investment. The participation in this rally is at 100%, although there are few that haven't had "golden crosses" yet which has the GCI at 96.55%. This area is hot. It is benefiting from the Dollar's decline and Gold/Silver's rise to power.
CRUDE OIL (USO)
IT Trend Model: NEUTRAL as of 1/27/2020
LT Trend Model: SELL as of 2/3/2020
USO Daily Chart: We finally got a breakout on USO. Unfortunately it closed near the low for the day. Although, given the positive RSI and PMO, I would expect to see it move higher with $30 as a new support level.
IT Trend Model: BUY as of 6/26/2020
LT Trend Model: BUY as of 1/2/2019
TLT Daily Chart: Full disclosure, I own TLT. It's acting flaky but so far remains above the 20-EMA. The PMO ticked lower, but it did the same last week and recovered. The RSI is positive. My line in the sand will be the 20-EMA.
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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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