SPY 10-Minute Chart: The market made its way higher most of the day but began to stumble after lunch. There was an attempt to come out of the decline, but instead we saw a second top. This has set up a bearish double top formation that could indicate that price will make its way lower tomorrow. The 10-minute PMO is declining and Stochastics looks somewhat weak. However, today we saw an upside initiation climax so any decline may be temporary.
The DecisionPoint Alert Weekly Wrap presents an end-of-week assessment of the trend and condition of the Stock Market, the U.S. Dollar, Gold, Crude Oil, and Bonds. The DecisionPoint Alert daily report (Monday through Thursday) is abbreviated and gives updates on the Weekly Wrap assessments.
MARKET/INDUSTRY GROUP/SECTOR INDEXES
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THE MARKET (S&P 500)
IT Trend Model: NEUTRAL as of 3/4/2025
LT Trend Model: SELL as of 4/16/2025
SPY Daily Chart: The double top formation has busted already which is especially bullish. The PMO is on the rise. The RSI is not overbought so we could see more upside ahead.
The VIX is bullish as it is holding above its moving average on the inverted scale. Stochastics also look bullish as they rise above 80.
S&P 500 New 52-Week Highs/Lows: New Highs expanded on the rally and are nearing May highs. The High-Low Differential reversed higher yesterday and today continued to move upward. It doesn't look that bullish however as it is running flat.
Climax* Analysis: There were two climax readings on the four relevant indicators today, which gives us an upside initiation climax. Total Volume was on average so we believe it has been confirmed.
*A climax is a one-day event when market action generates very high readings in, primarily, breadth and volume indicators. We also include the VIX, watching for it to penetrate outside the Bollinger Band envelope. The vertical dotted lines mark climax days -- red for downside climaxes, and green for upside. Climaxes are at their core exhaustion events; however, at price pivots they may be initiating a change of trend.
Short-Term Market Indicators: The short-term market trend is UP and the condition is NEUTRAL.
The Swenlin Trading Oscillators (STOs) are still rising which is bullish, but we have annotated new negative divergences with price given we have a new closing high above the May top. Participation is healthy, not necessarily robust. We did see more rising PMOs bring %PMOs Rising above our bullish 50% threshold.
Intermediate-Term Market Indicators: The intermediate-term market trend is UP and the condition is OVERBOUGHT.
The ITBM and ITVM were mixed. Today the ITVM bottomed above the zero line which is positive. We did see a few more PMO BUY Signals.
PARTICIPATION CHART (S&P 500): The following chart objectively shows the depth and trend of participation for the SPX in two time frames.
- Intermediate-Term - the Silver Cross Index (SCI) shows the percentage of SPX stocks on IT Trend Model BUY signals (20-EMA > 50-EMA). The opposite of the Silver Cross is a "Dark Cross" -- those stocks are, at the very least, in a correction.
- Long-Term - the Golden Cross Index (GCI) shows the percentage of SPX stocks on LT Trend Model BUY signals (50-EMA > 200-EMA). The opposite of a Golden Cross is the "Death Cross" -- those stocks are in a bear market.
The market bias is BULLISH in the intermediate and long terms.
Participation is at healthy levels, levels that could keep this rally moving higher. We do note that we have declining tops on %Stocks > 20/50/200EMAs and that does set up negative divergences with price. The Silver Cross Index turned back up today above its signal line which is very positive. It is holding above its signal line so the IT Bias is BULLISH. The Golden Cross Index decelerated today, but is ultimately moving higher. It is also above its signal line so the LT Bias is BULLISH.
BIAS Assessment: The following table expresses the current BIAS of various price indexes based upon the relationship of the Silver Cross Index to its 10-day EMA (intermediate-term), and of the Golden Cross Index to its 20-day EMA (long-term). When the Index is above the EMA it is bullish, and it is bearish when the Index is below the EMA. The BIAS does not imply that any particular action should be taken. It is information to be used in the decision process.
The items with highlighted borders indicate that the BIAS changed today.
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CONCLUSION: Today's rally was supposedly generated by good jobs data today. It put price above the prior two tops which has busted the bearish double top that was developing. Unfortunately with that rally above resistance came some negative divergences. We have negative divergences on the STOs and on participation. The good news is that we did see an upside initiation climax and the ITVM turned up, that seems to suggest the rally will continue on. The negative divergences should keep us cautious though. For now we expect some upside follow-through.
Erin is 60% long, 0% short. (This is intended as information, not a recommendation.)
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CALENDAR
BITCOIN
Bitcoin declined but it is showing a slight rising trend in the very short term. We thought we'd see a pullback to 100,000, but that may not be the case. There is still a declining trend out of the all-time highs and the PMO is still declining so we don't want to get too bullish here. Stochastics do seem to suggest Bitcoin will break its declining trend.
BITCOIN ETFs
INTEREST RATES
Yields rose again today so we may see a period of rising rates. Long-term yields are in rising trends so we'll look for them to move higher from here.
The Yield Curve Chart from StockCharts.com shows us the inversions taking place. The red line should move higher from left to right. Inversions are occurring where it moves downward.
10-YEAR T-BOND YIELD
Not much happened on the $TNX chart today. The bullish falling wedge did execute yesterday with a tiny breakout. It stood still today. We think this is a good place to look for a rally off support. Stochastics are trying to turn back up. The PMO is on a Crossover SELL Signal, but it has flattened out.
BONDS (TLT)
IT Trend Model: SELL as of 4/14/2025
LT Trend Model: SELL as of 12/13/2024
TLT Daily Chart: TLT formed a bearish engulfing candlestick today that does imply we'll see lower prices tomorrow. Yields are looking slightly more bullish so we expect Bond funds to stumble here. The PMO is rising on a Crossover BUY Signal, but it is essentially flat and well below the zero line so we don't see strength here. Stochastics have topped. We expect TLT to retreat further.
DOLLAR (UUP)
IT Trend Model: NEUTRAL as of 3/5/2025
LT Trend Model: SELL as of 4/25/2025
UUP Daily Chart: The Dollar is in a short-term declining trend and that was not interrupted by today's rally. We still think the Dollar has further to fall. The PMO did turn up, but ultimately it is flat beneath the zero line and that means pure weakness. We expect support to be tested at 27.
GOLD
IT Trend Model: BUY as of 1/10/2025
LT Trend Model: BUY as of 10/20/2023
GLD Daily Chart: Gold dropped back into the declining trend channel, but given yesterday's strong showing, we see Gold moving higher. The PMO is rising and Stochastics are above 80 so there is still some strength to take advantage of.
Discounts are getting elevated again, meaning investors are very bearish on Gold right now. Elevated discounts are generally bullish for Gold. They aren't at extremes yet, but they are very close.
GOLD MINERS (GDX) Daily Chart: Gold Miners pulled back with Gold today. They still look very bullish given the strong indicators. Participation is top notch and the Silver/Golden Cross Indexes are reading at the top of the range. There is plenty of strength here. If Gold pulls back instead of breaking out as we expect, then we will see some problems here. For now, it looks good for more rally.
CRUDE OIL (USO)
IT Trend Model: NEUTRAL as of 2/27/2025
LT Trend Model: SELL as of 3/18/2025
USO Daily Chart: Crude is still stuck beneath resistance. It really wants to break out. It did close above prior tops so it is getting close. The PMO is almost to the zero line and Stochastics are rising in positive territory. Even if we get the breakout, there is still a declining tops trendline to deal with as well as the 200-day EMA. We do think we'll get a breakout here, but aren't looking for a strong rally out of the declining trend.
Good Luck & Good Trading!
Erin Swenlin and Carl Swenlin
Technical Analysis is a windsock, not a crystal ball. --Carl Swenlin
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