Today’s Market Comments:
Stocks were mixed Monday, September 10th, with Trannies hitting a new all-time high, the Industrials declining and sitting below their all-time high, with the S&P 500, techs and small caps up mildly. On Monday the stock market generated its 7th Hindenburg Omen observation since August 2018, with five observations in consecutive days, an “official” H.O. potential stock market crash signal. This indicator is warning in no uncertain terms that the stock market sits in a fragile condition at this time. A black swan event would crush the market. Global stock markets are either crashing or on the precipice of crashing. Our Blue Chip 10 day average Advance/Decline Line Indicator generated a new Sell signal Monday. Our important Blue Chip Purchasing Power Indicator, which identifies when short-term trends are turning, remains on a new Sell signal from last Thursday. Our Purchasing Power Indicator for small caps and for techs also remains on a Sell. It does appear that the S&P 500 has completed a Rising Bearish Wedge and the next declining trend is about to begin if it has not already.
On page 25 we show a chart of U.S. Treasury Bonds. They look to need to rally several points to complete the wave c-up portion of a corrective wave a-up, b-down, c-up corrective rally for the five wave decline that started in September 2017 and completed in May 2018. Gold, Silver and Mining stocks are completing a corrective decline that should soon end and be followed by a strong rally.
Our Blue Chip key trend-finder indicators moved to a Sell signal September 6th, 2018 and remain there Monday, September 10th. 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 Monday, September 10th, rising 6 points (out of a possible 9 points), positive +4, needing to fall below the negative – 5 threshold for the new Sell.
Demand Power rose 2 to 374 Monday while Supply Pressure fell 2 to 371, telling us Monday’s decline in Blue Chips was moderate. This DP/SP Indicator moved to an Exit Long Signal Friday, September 7th, and remains there Monday, September 10th, 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 essentially Fla t Monday, Miners fell slightly. They generated a Sell signal Friday, July 13th, as the HUI 30 Day Stochastic triggered a Sell signal July 13th, 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 Monday, September 10th, Demand Power fell 3 to 375 while Supply Pressure rose 2 to 427, telling us Monday’s HUI decline was mild.
DJIA PPI Rose 1 to + 82.63, on a Sell
DJIA 30 Day Stochastic Fast 70.00 Slow 67.33 On a Sell
DJIA 14 Day Stochastic Fast 53.33 Slow 56.11 On a Sell
DJIA % Above 30 Day Average 70.00
DJIA % Above 10 Day Average 46.67
DJIA % Above 5 Day Average 60.00
Secondary Trend Indicator Rose 6 to Positive 4, On a Buy
Demand Power Up 2 to 374, Supply Pressure Fell 2 to 371 Neutral
McClellan Oscillator Fell to Negative -83.02
McClellan Osc Summation Index + 2266.35
Plunge Protection Team Indicator – 1.32, on an “OFF”
DJIA 10 Day Advance/Decline Indicator -157.7 on a Sell
NYSE New Highs 96 New Lows 89
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 10th, 2018. The NDX Purchasing Power Indicator generated a Sell on September 5th, 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 anExit Long positions signal Thursday, September 6th and remains there September 10th. On Monday September 10th, Demand Power rose 1 to 410, while Supply Pressure fell 2 to 412, telling us Monday’s rise was mild.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Buy signal August 6th, 2018, and needs to fall below negative – 5.0 for a new Sell. It fell to positive + 4 on Monday, September 10th.
NDX PPI Rose 1 to + 262.70 On a Sell
NDX 30 Day Stochastic Fast 55.95 Slow 56.19 On a Buy
NDX 14 Day Stochastic Fast 45.24 Slow 49.52 On a Sell
NDX 10 Day Advance/Decline Line Indicator – 0.4 On a Buy
NDX Demand Power Up 1 to 410, Supply Pressure Fell 2 to 412 Buy
RUT PPI Flat at + 194.86 on a Sell
RUT 10 Day Advance/Decline Line Indicator -90.5 On a Buy
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Sell signal July 13th, 2018.
HUI PPI Fell 1 to 148.78, on a Sell, Needs 154.78 for a new Buy.
HUI 30 Day Stochastic Fast 10.00, Slow 10.56 on a Sell
HUI Demand Power Fell 3 to 375; Supply Pressure Up 2 to 427, Sell