Today’s Market Comments:
Stocks rose Tuesday, September 18th on narrow upside breadth and modest volume. The Industrials look to be working toward the completion of a Rising Bearish Wedge, and the final wav e-up for that pattern from July 2018 needed another small rally leg. That appears to be going on now. The S&P 500 and NASDAQ 100 did not rise above their recent Rising Bearish Wedge tops, so the rally Tuesday could be correcting the start of the next large degree wave down for those indices. We did not get any changes to our key trend-finder indicators from Tuesday’s rally. The Blue Chip, Tech and small cap Russell 2000 Purchasing Power Indicators remain on a Sell signal Tuesday.
The stock market generated its 13th Hindenburg Omen observation Tuesday for the official H.O. from August 14th. It was the 11th day in a row for an H.O. observation, which is unprecedented. This tells us the stock market sits in a fragile condition at this time, and is susceptible to a strong selloff should a black swan trigger event occur.
The HUI Mining stocks generated a new Buy signal with their 30 day stochastic, which moved our HUI mining stock key trend-finder indicator to a Neutral signal from a Sell. The HUI Purchasing Power Indicator remains on a Sell, but is very close to a new Buy signal. Once it joins the HUI 30 day stochastic on a Buy, we will have high confidence the next Bull market in Mining stocks and precious metals has started.
Our Blue Chip key trend-finder indicators moved to a Sell signal September 6th, 2018 and remain there Tuesday, September 18th. The Purchasing Power Indicator component triggered a Sell signal Thursday, September 6th. The 14-day Stochastic Indicator generated a Sell on August 31st, and the 30 Day Stochastic Indicator generated a Sell on August 23rd, 2018. When these three indicators agree, it is a short-term (1 week to 3 months’ time horizon) key trend-finder directional signal. When these three indicators are in conflict with one another, it is a Neutral (Sideways) key trend-finder indicator signal.
Our intermediate term Secondary Trend Indicator generated a Buy signal Tuesday, July 3rd, and remains there Tuesday, September 18th, rising 6 points (out of a possible 9 points), to positive + 16, needing to fall below the negative – 5 threshold for the new Sell.
Demand Power rose 3 to 378 Tuesday while Supply Pressure fell 2 to 370, telling us Tuesday’s rise in Blue Chips was mild. This DP/SP Indicator moved to an Enter Long Signal Thursday, September 13th, and remains there Tuesday, September 18th, 2018.
The Plunge Protection Team Indicator moved back to an “OFF” signal on March 21st, which means the PPT is not as likely to support the markets while this indicator remains on an “OFF.” This means there is not likely to be significant government intervention at this time, or if there is it will not be effective. This indicator is designed to identify high probability periods where the PPT will be supporting, or buying the stock market (when it is on an “On” signal) and when it moves to a Neutral or Off signal (formerly called Sell), it does not mean the stock market will decline, it means the PPT’s interest in buying the market is off rather than on, and market forces outside the PPT are more likely to determine stock trends up or down. In other words, a Neutral or Off signal means the odds are higher that the PPT stands down or has little influence on price trends.
Caution: I would not bet the farm on a Crash. Crashes are rare and maybe the pattern will morph into something we presently do not see that is less ominous. Risk must be managed. Maybe the Fed buys the entire stock market, who knows given their track record. Maybe a black swan event is postponed several months.
Gold and Silver were flat and Mining stocks rose Tuesday. They generated a Neutral signal Tuesday, September 18th, as the HUI 30 Day Stochastic triggered a Buy signal September 18th, and our HUI Purchasing Power Indicator generated a Sell on June 15th. When these two indicators agree, it is a directional signal, and when at odds with one another, it is a combination neutral signal. On May 29th, the HUI Demand Power / Supply Pressure Indicator moved to a Short signal. On Tuesday, September 18th, Demand Power rose 2 to 394 while Supply Pressure fell 4 to 406, telling us Tuesday’s HUI rise was mild.
DJIA PPI Rose 3 to + 87.25, on a Sell
DJIA 30 Day Stochastic Fast 73.33 Slow 74.00 On a Sell
DJIA 14 Day Stochastic Fast 73.33 Slow 65.56 On a Sell
DJIA % Above 30 Day Average 73.33
DJIA % Above 10 Day Average 73.33
DJIA % Above 5 Day Average 76.67
Secondary Trend Indicator Rose 6 to Positive + 16, On a Buy
Demand Power Rose 3 to 378, Supply Pressure Fell 2 to 370 Buy
McClellan Oscillator Rose to Negative – 39.52
McClellan Osc Summation Index + 1986.26
Plunge Protection Team Indicator – 0.79, on an “OFF”
DJIA 10 Day Advance/Decline Indicator – 57.3 on a Sell
NYSE New Highs 90 New Lows 114
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated aSideways signal Tuesday, September 4th, 2018, and remain there September 18th, 2018. The NDX Purchasing Power Indicator generated a Sell on September 17th, the NDX 14 Day Stochastic triggered a Sell signal on September 4th, 2018 and the 30 Day Stochastic triggered a Buy signal on July 6th. When all three component indicators are in agreement on signals, it is a consensus directional signal. When they differ, it is a sideways signal.
The NDX Demand Power / Supply Pressure Indicator moved to anEnter Short positions signal Monday, September 17th and remains there September 18th. On Tuesday September 18th, Demand Power rose 6 to 412, while Supply Pressure fell 5 to 415, telling us Tuesday’s rise was moderate.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Sell signal September 11th, 2018, and needs to rise above positive + 5.0 for a new Buy. It rose to zero + 0.0 on Tuesday, September 18th.
NDX PPI Rose 6 to + 267.39 On a Sell
NDX 30 Day Stochastic Fast 55.95 Slow 55.48 On a Buy
NDX 14 Day Stochastic Fast 46.43 Slow 49.19 On a Sell
NDX 10 Day Advance/Decline Line Indicator + 0.0 On a Sell
NDX Demand Power Up 6 to 412, Supply Pressure Fell 5 to 415 Sell
RUT PPI Rose 1 to 193.17 on a Sell
RUT 10 Day Advance/Decline Line Indicator – 150.8 On a Sell
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Neutral signal September 18th, 2018.
HUI PPI Flat at + 154.51, on a Sell, Needs 154.78 for a new Buy.
HUI 30 Day Stochastic Fast 40.00, Slow 18.33 on a Buy
HUI Demand Power Up 2 to 394; Supply Pressure Fell 4 to 406, Sell