Today’s Market Comments:
Stocks dove Wednesday, August 15th, a day after an Official Hindenburg Omen was triggered. The decline was stopped by key support in various Indices. The Industrials fell to their 50 day moving average, stopped, and bounced from the 25,000 level. The S&P 500 fell and stopped at the 2800 level, just above its 50 day moving average, which also could be the bottom of wave d for a slightly redrawn bottom boundary to a Rising Bearish Wedge pattern from May 2018. See chart on page 26. If so, wave e-up should be next to complete the Wedge. Further decline would suggest the Wedge completed and a major declining trend has started. The Russell 2000 fell precisely to the bottom boundary of a Symmetrical Sideways Triangle pattern and stopped there. If this triangle pattern is valid, then small caps should soon rise sharply. See chart on page 28. Interestingly, Trannies closed up for the day. The NASDAQ 100 Purchasing Power Indicator and Demand Power / Supply Pressure Indicator moved to new Sell signals Wednesday. The stock market sits in a vulnerable state tonight. Our key trend-finder indicators remain Neutral tonight.
Mining stocks and Metals got sold hard Wednesday. They are completing the final declining portion of a large corrective decline that started back in 2016. It looks like the corrective declines have morphed into 3-3-5 Flat patterns from what once looked like Triangles. Miners are deep oversold, with the Full Stochastics and our 10 day average Advance/Decline Line Indicator deep oversold. It looks very much like Miners are seeing Selling capitulation which means the bottom is not far off. A new Buy signal in our HUI key trend-finder indicators would confirm that corrective wave 2-down is over, and a huge wave 3-up is starting. Gold and Silver are also completing Flat patterns and once finished will see a huge Bull market.
Our Blue Chip key trend-finder indicators moved to a Neutral signal August 10th, 2018 and remain there Wednesday, August 15th. The Purchasing Power Indicator component triggered a Sell signal Monday, August 13th. The 14-day Stochastic Indicator generated a Sell on August 10th, and the 30 Day Stochastic Indicator generated a Buy on July 9th, 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 Wednesday, August 15th, dropping 6 points (out of a possible 9 points), positive + 13, needing to fall below the negative – 5 threshold for the new Sell.
Demand Power fell 5 to 378 Wednesday while Supply Pressure rose 8 to 386, telling us Wednesday’s drop in Blue Chips was moderate to strong. This DP/SP Indicator moved to an Exit Long Signal Monday, July 13th, and remains there Wednesday, August 15th, 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, Silver and Miners fell sharply Wednesday. 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 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 Wednesday, August 15th, Demand Power fell 3 to 363 while Supply Pressure rose 15 to 444, telling us Wednesday’s HUI decline was powerful and there was a deep pockets buyer supporting prices.
DJIA PPI Fell 5 to + 71.49, on a Sell
DJIA 30 Day Stochastic Fast 66.67 Slow 57.33 On a Buy
DJIA 14 Day Stochastic Fast 43.33 Slow 53.33 On a Sell
DJIA % Above 30 Day Average 66.67
DJIA % Above 10 Day Average 33.33
DJIA % Above 5 Day Average 43.33
Secondary Trend Indicator Fell 6 to Positive + 13, On a Buy
Demand Power Fell 5 to 378, Supply Pressure Up 8 to 386 Neutral
McClellan Oscillator Fell to negative – 88.31
McClellan Osc Summation Index + 1935.68
Plunge Protection Team Indicator + 6.01, on an “OFF”
DJIA 10 Day Advance/Decline Indicator + 9.2 on a Buy
NYSE New Highs 55 New Lows 153
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated aNeutral signal Friday, August 10th, 2018, and remain there August 15th, 2018. The NDX Purchasing Power Indicator generated a Sellon August 15th, the NDX 14 Day Stochastic triggered a Sell signal on August 10th, 2018 and the 30 Day Stochastic triggered a Buysignal 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 Wednesday, August 15th and remains there August 15th. On Wednesday August 15th, Demand Power fell 6 to 410, while Supply Pressure rose 8 to 421, telling us Wednesday’s decline was strong.
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 + 0.6 on Wednesday, August 15th.
NDX PPI Fell 12 to + 259.37 On a Sell
NDX 30 Day Stochastic Fast 50.00 Slow 56.19 On a Buy
NDX 14 Day Stochastic Fast 35.71 Slow 46.19 On a Sell
NDX 10 Day Advance/Decline Line Indicator + 0.6 On a Buy
NDX Demand Power Fell 6 to 410, Supply Pressure Up 8 to 421 Sell
RUT PPI Fell 5 to 186.97 on a Buy
RUT 10 Day Advance/Decline Line Indicator -16.4 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 11 to 155.27, on a Sell
HUI 30 Day Stochastic Fast 5.00, Slow 16.11 on a Sell
HUI Demand Power Fell 3 to 363; Supply Pressure Up 15 to 444, Sell