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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 (-)

Tuesday, February 19, 2019

Daily udpate 2/19

Resistance area touched.


SPX stuck its head above the 12/4 big down day high.  It actually stayed up there for a little while, but sold off going into the close.  The breadth was +61%.  New highs expanded to 123 (close to Jan. 31 count).  New lows came in at 10. 


Despite the slight new high today the futures look like they are consolidating. 

The market remains short term overbought.  It is now getting into an area of possible resistance.  There has been no selling pressure on this rally since Jan. 3.  The question is what happens when the rally finally stops.  How much profit taking will there be?  Bad economic news has been ignored, but it hasn't gone away.  Breadth has been extremely strong.  Many analysts are quick to point that out.  The all company advance/decline line has made a new high.  There will be lots of people expecting the broad market to follow that to new highs as well.  They will be quick to point out that this has never happened in a bear market before.  One problem with the market is that nothing is 100 percent.  The FED has never done QT before.  History is often a great guide, but there is no comparable history to our current situation.  What bothers me the most is the way the global economy is acting.  I believe there is way too much downside risk to say the worst is over.  

My take on the breadth is this.  I believe we had the narrowest bull market top in history.  Now some money is coming out of FAANG and the few other big winners and is spreading out to the stocks that were left behind.  I saw this happen in 2000, but it was less pronounced because as narrow as that top was it was much broader than this one.  Let  me tell you the breadth confused the heck out of me back then.  I am not going to let it do that again.  I am looking for other confirming signs the worst is over and I am not seeing anything yet.  I want to see what happens when the market corrects this rally and go from there.

Bob

1 comment:

Unknown said...

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