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Trend table status

Trend

SP-500

R2000

COMPX

Primary

Up 7/31/20

?- 3/31/20

Up 5/29/20

Intermediate

?+ 9/25/20

Up 8/21/20

?+ 9/18/20

Sub-Intermediate

?- 9/15/20

Dn 9/11/20

Dn 9/21/20

Short term

? 9/4/20

? 8/18/20

? 9/4/20


Don Worden of Worden Brothers (makers of Telechart software) used to keep a trend table before his health issues got in the way. I always found it useful. Mine is slightly different. Hopefully helpful. Up? or Dn? means loss of momentum. ? by itself means trend is neutral. ?+ or ?- means trend is neutral with bias of up(+) or down (-)

Thursday, May 2, 2013

Margin debt

The margin debt data for March came out and it was almost at record levels.  Since April closed higher it is probable the debt will be at a new record high when we get that data.  Here is an interesting chart of the latest data.

 Source

Into the 2000 and 2007 tops there were very sharp spikes up in the margin debt.  We have the same situation today as the debt has spiked up sharply since the middle of last year.  The other two major tops had the margin debt peaking before the final high in SPX.  Can we count on that again?   I don't know if it safe to assume that or not.  The global economy was clearly not in recession at the other two tops.  It certainly looks like it most likely is today.  People like to say this is a hated rally, but clearly people have grown to love it now.  This is not based on what people say, this is based on what people do.   This next chart shows it even more clearly I think.

Source

Only in the euphoric days of 2000 were credit balances lower then this.  I don't think we will reach that level from 2000 and we are already below the level from 2007.  The market is now on borrowed time (and money) and another crash is coming, QE or not.  The only question is when.

Bob

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The information in this blog is provided for educational purposes only and is not to be construed as investment advice.