Today’s Market Comments:

 

Stocks rose sharply Wednesday, October 31st, then gave up most of the intraday gains, ending higher, but forming Shooting Star candlestick patterns, that often point toward a decline over the next day or two. Our key short-term trend-finder indicators remain on a Buy signal. The Industrials closed at their 200 day moving average, which was resistance.

Stocks look to have completed the first down leg of the new Bear market, wave 1-down on October 29th. Since then, stocks are rising in a corrective wave 2-up. It is possible the first leg up of an{a} up, {b} down, {c} up move for 2-up is finished and {b} down is underway, with {c} up to follow. The {a} portion was fast, so it is possible the entire wave 2-up move could finish around our Phi mate turn date, November 7th, which is also right next to the Midterm election on November 6th. If so, wave 3-down would start next week, and be worse than 1-down was in October. There is always the possibility that wave 2-up forms a time consuming complex corrective rally pattern that lasts into December. Once our key trend-finder indicators move back to a Sell, we will likely have confirmation that wave 3-down is starting.

 

New NYSE Lows have run above 79 for 42 consecutive trading days, which is an astonishing and dangerous condition.

Our Mining stock key trend-finder indicators are on a Sell signal Tuesday.

Our Blue Chip key trend-finder indicators moved to a Buy signal October 30th, 2018 and remain there Wednesday, October 31st. The Purchasing Power Indicator component triggered a Buy signal Tuesday, October 30th. The 14-day Stochastic Indicator generated a Buy on October 30th, and the 30 Day Stochastic Indicator generated a Buy on October 30th, 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 Sell signal Wednesday, October 10th, and remains there Wednesday, October 31st, rising 4 points (out of a possible 9 points), to negative -13. It will need to rise above positive + 5 for a new Buy signal.

Demand Power up 8 to 396 Monday while Supply Pressure fell 5 to 451, telling us Wednesday’s rise in Blue Chips was strong with short covering about half the buying. This DP/SP Indicator moved to an Enter Short Signal October 4th, and remains there Wednesday, October 31st, 2018. The plunge came right after this Sell signal.

The Plunge Protection Team Indicator moved to an “OFF” signal on October 25th, which means the PPT is not 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. 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, Silver and Miners fell Wednesd ay . They generated a Sell signal Thursday, October 25th, as the HUI 30 Day Stochastic triggered a Sell signal October 24th, and our HUI Purchasing Power Indicator generated a Sell on October 25th. When these two indicators agree, it is a directional signal, and when at odds with one another, it is a combination neutral signal. The HUI Demand Power / Supply Pressure Indicator moved to an Enter Short signal Wednesday, October 24th. On Wednesday, October 31st, Demand Power fell 5 to 398 while Supply Pressure rose 4 to 428, telling us Wednesday’s HUI decline was moderate.

DJIA PPI rose 6 to 22.03, on a Buy

DJIA 30 Day Stochastic Fast 33.33 Slow 25.33 On a Buy

DJIA 14 Day Stochastic Fast 50.00 Slow 32.78 On a Buy

DJIA % Above 30 Day Average 33.33

DJIA % Above 10 Day Average 66.67

DJIA % Above 5 Day Average 96.67

Secondary Trend Indicator Up 4 to Negative -13, On a Sell

Demand Power Up 8 to 396, Supply Pressure fell 5 to 451 Sell

McClellan Oscillator Rose to Positive + 14.67

McClellan Osc Summation Index -1335.70

Plunge Protection Team Indicator + 12.22, on an “OFF”  

DJIA 10 Day Advance/Decline Indicator – 361.4 on a Sell

NYSE New Highs 25 New Lows 142

Today’s Technology NDX Market Comments:

The NDX Short-term key Trend-finder Indicators generated aSideways signal Tuesday, October 30th, 2018, and remain there October 31st, 2018. The NDX Purchasing Power Indicator generated a Buy on October 30th, the NDX 14 Day Stochastic triggered a Buy signal on October 30th, 2018 and the 30 Day Stochastic triggered a Sell signal on October 24th. 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 Thursday, October 4th and remains there October 31st. On Wednesday October 31st, Demand Power rose 13 to 439, while Supply Pressure fell 6 to 483, telling us the rise was strong with over half the buying coming from shorts covering open positions.

 

The NDX 10 Day Average Advance/Decline Line Indicator triggered a Sell signal October 4th, 2018, and needs to rise above positive + 5.0 for a new Buy. It rose to negative -11.2 on Wednesday, October 31st.

 

NDX PPI Rose 17 to 173.20 On a Buy

NDX 30 Day Stochastic Fast 20.24 Slow 12.14 On a Sell

NDX 14 Day Stochastic Fast 45.24 Slow 24.52 On a Buy

NDX 10 Day Advance/Decline Line Indicator -11.2 On a Sell

NDX Demand Power Up 13 to 439, Supply Pressure Fell 6 to 483 Sell

RUT PPI Up 1 to 141.95 on a Buy

RUT 10 Day Advance/Decline Line Indicator – 312.4 On a Sell

Today’s Mining Stocks and Precious Metals Market Comments:

Our HUI key trend-finder indicators moved to a Sell signal October 25th, 2018.

HUI PPI Fell 1 to + 159.22, on a Sell

HUI 30 Day Stochastic Fast 15.00, Slow 47.78 on a Sell

HUI Demand Power Fell 5 to 398; Supply Pressure Up 4 to 428, Sell