Today’s Market Comments:
Stocks fell Thursday, May 31st in end of month high volume trading. The decline in techs was mild, stronger in Blue Chips. There were no changes to our key trend indicators Thursday. The Purchasing Power Indicators for Blue Chips, Techs, Small Caps and Mining stocks remain on Buy signals. Thursday was the next scheduled major Bradley model turn date. The previous major Bradley model turn date came at the January 2018 top, and kicked off the large degree wave iv triangle pattern. So, this turn +/- a few days could produce the start of a breakout from the triangle, either up or down. The triangles for Blue Chips and Techs may need one more decline, wave e-down, to finish the pattern. However, the small cap Russell 2000 looks to have broken out to the upside from its triangle. Price movement over the next week could prove interesting and helpful in identifying the next significant vertical trend. Our expectation is the breakout will be up, wave v-up. If it breaks down, it means the triangles were a coincidence, and were a series of waves one-down and two up, with resolution wave threes down next, a plunge. The dull market from the past several months should soon become interesting.
Precious Metals and Mining stocks are finishing continuation sideways triangle patterns, and once complete, will breakout higher, Gold heading toward 1600 eventually.
Our Blue Chip key trend-finder indicators moved to a Sideways signal May 30th, 2018 and remain there Thursday, May 31st. The Purchasing Power Indicator component triggered a Buy signal Wednesday, May 30th. The 14-day Stochastic Indicator generated a Sell on May 18th, and the 30 Day Stochastic Indicator generated a Sell on May 29th, 2018. 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 (Sideways) key trend-finder indicator signal.
Our intermediate term Secondary Trend Indicator generated a Buy signal Wednesday, August 30th, and remains there Thursday, May 31st, dropping 8 points (out of a possible 9 points), to negative -2, needing to drop below negative -5 threshold for a new Sell.
Demand Power fell 5 to 390 Thursday while Supply Pressure rose 8 to 381, telling us Thursday’s decline in Blue Chips was moderate. This DP/SP Indicator moved to an Enter Long Signal Wednesday, May 2nd, and remains there Thursday, May 31st, 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, Silve r and Miners fell slightly Thursday, May 31st, and are finishing their Bullish triangles. They moved to a Buy signal Thursday, May 24th, as the HUI 30 Day Stochastic triggered a Buy signal May 24th, and our HUI Purchasing Power Indicator generated a Buy on March 26th. 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 May 29th, the HUI Demand Power / Supply Pressure Indicator moved to a Short signal. On Thursday, May 31st, Demand Power fell 3 to 385 while Supply Pressure rose 2 to 397, telling us Thursday’s HUI decline was mild.
DJIA PPI Fell 4 to + 54.41, on a Buy
DJIA 30 Day Stochastic Fast 50.00 Slow 54.67 On a Sell
DJIA 14 Day Stochastic Fast 26.67 Slow 47.78 On a Sell
DJIA % Above 30 Day Average 50.00
DJIA % Above 10 Day Average 23.33
DJIA % Above 5 Day Average 23.33
Secondary Trend Indicator Fell 8 to Negative -2, On a Buy
Demand Power Fell 5 to 390, Supply Pressure Rose 8 to 381 Buy
McClellan Oscillator fell to positive + 3.94
McClellan Osc Summation Index + 2512.41
Plunge Protection Team Indicator – 9.19, on an “OFF”
DJIA 10 Day Advance/Decline Indicator + 136.8 on a Buy
NYSE New Highs 102 New Lows 66
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated aSideways signal Thursday, April 26th, 2018, and remain there May 31st, 2018. The NDX Purchasing Power Indicator generated a Buyon May 23rd, the NDX 14 Day Stochastic triggered a Sell signal on May 29th, 2018 and the 30 Day Stochastic triggered a Sell signal on April 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 Long positions signal Monday, May 7th and remains there May 31st. On Thursday May 31st, Demand Power fell 4 to 413, while Supply Pressure rose 4 to 404, telling us Thursday’s decline was moderate.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Buy signal May 7th, 2018, and needs to fall below negative – 5.0 for a new Sell. It fell to positive – 3.0 on Thursday, May 31st.
NDX PPI Down 1 to + 228.33 On a Buy
NDX 30 Day Stochastic Fast 50.00 Slow 53.00 On a Sell
NDX 14 Day Stochastic Fast 43.00 Slow 48.20 On a Sell
NDX 10 Day Advance/Decline Line Indicator – 3.0 On a Buy
NDX Demand Power Fell 4 to 413, Supply Pressure Up 4 to 404 Buy
RUT PPI Fell 3 to +189.15 on a Buy
RUT 10 Day Advance/Decline Line Indicator + 136.2 On a Buy
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Buy signal May 24th, 2018.
HUI PPI Flat at 184.10, on a Buy
HUI 30 Day Stochastic Fast 45.00, Slow 44.44 on a Buy
HUI Demand Power Fell 3 to 385; Supply Pressure Up 2 to 397, Sell