Today’s Market Comments:
Stocks fell hard Thursday, August 10th, and it is apparent the Rising Bearish Wedge from the April 2017 lows has completed. The charts on pages 27 and 29 show that the Industrials and S&P 500 have declined in five subwaves from the August highs, suggesting a new significant declining trend has begun. The initial downside price target for the Industrials is 20,400. We got new Sell signals in our important short-term key trend-finder indicators for both the Blue Chips and the NASDAQ 100. Our Purchasing Power Indicator generated a new Sell signal Thursday. Worse, our reliable intermediate term Secondary Trend Indicator also generated a new Sell signal Thursday. We also got a new Sell signal in our Blue Chip Demand Power / Supply Pressure Indicator. Short-term, there could be a bounce since we have seen a five wave decline, so a correction is possible, however, once that completes, a strong decline should continue. We took another profit in our Platinum program Thursday, August 10th. We expect to be very active trading this market as volatility increases.
The chart on page 25 shows a large Rising Bearish Wedge for the Industrials from August 2015. This pattern is telling is that should the Industrials drop below 21,000, that would be very Bearish, and suggest this large Rising Wedge is complete with the August 2017 top, and warn of a downside price target to at least 15,500, a crash. We are on the clock of an 8 observation Hindenburg Omen, so this is a serious potential.
Our Blue Chip key trend-finder indicators moved to a Sell signal Thursday, August 10th, 2017 and remain there Thursday, August 10th. The Purchasing Power Indicator component triggered a Sell signal Thursday, August 10th. The 14-day Stochastic Indicator generated a Sell on August 10th, and the 30 Day Stochastic Indicator generated a Sell on June 21st. When these three indicators are in agreement, 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 key trend-finder indicator signal.
Our intermediate term Secondary Trend Indicator generated a Sell signal Thursday, August 10th, and remains there Thursday, August 10th, dropping 8 points (out of a possible 9 points), to negative -12, dropping decisively below the negative -5 threshold for a new Sell.
Demand Power fell 8 to 366 Thursday while Supply Pressure rose 14 to 394, telling us Thursday’s decline in Blue Chips was powerful with deep pockets intervention buying the market hard to prevent a collapse. This DP/SP Indicator moved to an Enter Short Signal Thursday, August 10th, and remains there Thursday, August 10th, 2017.
The Plunge Protection Team Indicator moved back to an “Off” signal on Thursday, December 15th, which means the PPT is likely to stand down from supporting the markets while this indicator remains on an “Off.” This does not mean stocks cannot rally, it just 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 a Buy signal) and when it moves to a Neutral of 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 Miners rose Thursday, August 10th. They generated a Sideways signal Friday, August 4th, a s the HUI 30 Day Stochastic triggered a Sell signal August 4th, and our HUI Purchasing Power Indicator generated a Buy on July 17th. When these two indicators are in agreement, it is a directional signal, and when at odds with one another, it is a combination neutral signal. On Friday, August 10th, the HUI Demand Power / Supply Pressure Indicator triggered an Exit Short signal. On Thursday, August 10th, Demand Power rose 4 to 403 while Supply Pressure fell 2 to 399, telling us Thursday’s HUI rise was moderate.
DJIA PPI Fell 10 to + 43.66 on a Sell
DJIA 30 Day Stochastic Fast 56.67 Slow 68.00 On a Sell
DJIA 14 Day Stochastic Fast 46.67 Slow 67.78 On a Sell
DJIA % Above 30 Day Average 56.67
DJIA % Above 10 Day Average 33.33
DJIA % Above 5 Day Average 20.00
Secondary Trend Indicator fell 8 to Negative – 12, On a Sell
Demand Power Fell 8 to 366, Supply Pressure Rose 14 to 394 Sell
McClellan Oscillator negative -245.77
McClellan Osc Summation Index + 2573.21
Plunge Protection Team Indicator + 8.56, on an Off
DJIA 10 Day Advance/Decline Indicator – 389.6 on a Sell
NYSE New Highs 39 New Lows 119
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated a Sell signal Thursday, August 10th, 2017, and remain there August 10th, 2017. The NDX Purchasing Power Indicator generated a Sell on July 31st, the NDX 14 Day Stochastic triggered a Sell signal on July 27th, 2017 and the 30 Day Stochastic triggered a Sell signal on August 10th. 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 an Enter Short positions signal Wednesday, August 9th and remains there August 10th. On Wednesday August 10th, Demand Power fell 6 to 400, while Supply Pressure rose 14 to 431, telling us Wednesday’s decline was powerful with deep pockets intervention buying stocks hard to prevent a deep plunge.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Sell signal August 9th, needing to rise above positive + 5.0 for a new Buy. It fell to – 16.2 on Thursday, August 10th, 2017.
NDX PPI Fell 18 to 156.10 On a Sell
NDX 30 Day Stochastic Fast 27.00 Slow 43.40 On a Sell
NDX 14 Day Stochastic Fast 16.00 Slow 29.80 On a Sell
NDX 10 Day Advance/Decline Line Indicator -16.2 On a Sell
NDX Demand Power Fell 6 to 400, Supply Pressure Up 14 to 431 Sell
RUT PPI Fell 6 to 139.56 on a Sell
RUT 10 Day Advance/Decline Line Indicator -267.5 On a Sell
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Sideways signal August 4th, 2017.
HUI PPI Rose 1 to 187.98, on a Buy
HUI 30 Day Stochastic Fast 85.00, Slow 71.11 on a Sell
HUI Demand Power Rose 4 to 403; Supply Pressure Fell 2 to 399, Exit Short