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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

Up 8/14/20

Up 8/21/20

?+ 9/18/20

Sub-Intermediate

?- 9/15/20

Dn 9/11/20

?- 9/14/20

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, January 4, 2018

Daily update 1/4 Steepening rally

The Dow hits 25,000 for first time ever.  I heard a pretty big discussion about it on the evening news.  I am sure there will be lots of glowing articles in papers tomorrow.


Another above average volume day.  Breadth was +57%.  New highs popped up to 289.  New lows slipped a bit to 19.  This is the first time the first two trading days of the year made new highs since 1964.  That was a positive low volatility year that followed low volatility in 1963.  There the similarity ends as 1962 saw a big sell off.  We have not had a comparably big sell off since 2011.  I don't know that history will be any guide to this year.


The futures continued to run above the upper channel line.  Still in accelerated up move mode.


The green count crossed 60, but remains below overbought levels.  There is still room to run if the bulls so choose.

Here is a look at the daily SPX chart with some trend lines drawn in.


The rally from the Feb. 2016 low has been getting steeper and steeper as the trend lines show.  If it gets much steeper it will be going straight up.  That is looking a little bubbly isn't it?  That certainly looks unsustainable doesn't it?

A lot of people seem convinced the market will continue up without any major pullback.  I can understand that since that is about all I hear or read in the media.  Bob Pisani said for the first time in this bull market this kind of feels like euphoria.  There is definitely no shortage of raging bulls.  Market history suggests this much bullishness combined with a very extended price pattern should lead to some kind of corrective activity.  The problem is the price pattern is looking very bubble like and bubbles can just keep on going beyond reason.  Maybe 25000 will provide a reason for some profit taking.  Historically millennial levels have often provided resistance.  That has not been the case since the break out to new highs last year.  I guess we will see.

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.