Today’s Market Comments:
Stocks opened sharply lower the first trading day of 2019, then spent the rest of the day recovering, ending up slightly. There were no changes to our short-term key trend-finder indicators for stocks, which remain on a Sideways (Neutral) signal. Our Intermediate term Secondary Trend Indicator remains on a Sell. Stocks are inside a corrective rally inside a larger degree major declining trend. This is a Major Bear market that started with a stock market crash. Once the current retracement rally finishes, a powerful decline will follow. This is not a flash crash situation, and is not a brief blip like occurred in August 2015. There is a global stock market crash going on, a global economic decline. The U.S. is participating in this, and is not immune to the coming consequences. We update Elliott Wave charts in tonight’s report.
Our HUI 30-day stochastic indicator generated a new Buy signal Wednesday, January 2nd, moving our Mining stocks key trend-finder indicator to a Sideways signal from a Sell. A powerful rising trend is expected in 2019 for precious metals and Mining stocks, large degree wave 3-up.
Our Blue Chip key trend-finder indicators moved to a Sideways signal December 26th, 2018 and remain there Wednesday, January 2nd, 2019. The Purchasing Power Indicator component triggered a Buy signal Wednesday, December 26th. The 14-day Stochastic Indicator generated a Buy on December 27th, and the 30 Day Stochastic Indicator generated a Sell on December 4th, 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, January 2nd, rising 6 points (out of a possible 9 points), to negative -18. It will need to rise above positive + 5 for a new Buy signal.
Demand Power rose 7 to 402 Wednesday while Supply Pressure fell 7 to 454, telling us Wednesday’s rise in Blue Chips was moderate. This DP/SP Indicator moved to an Enter Short Signal December 6th, and remains there Wednesday, January 2nd, 2019.
The Plunge Protection Team Indicator moved to an “OFF” signal on January 2nd, 2019, which means the PPT is not as likely to support the markets while this indicator remains on an “OFF.” This means there is n 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. Maybe a massive short-covering rally is induced by the PPT that causes a violent rally just when market participants are expecting more selling.
Gold, Silver and Miners rose slightly Wednesday. The HUI generated a key trend-finder indicator Sideways (Neutral) signal Wednesday, January 2nd, as the HUI 30 Day Stochastic triggered a Buy signal January 2nd, 2019, and our HUI Purchasing Power Indicator generated a Sell on December 19th. 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 Long signal Wednesday, December 12th. On Wednesday, January 2nd, Demand Power was flat at 424 while Supply Pressure fell 2 to 420, telling us Wednesday’s HUI move was mild.
DJIA PPI flat at negative -39.50, on a Buy
DJIA 30 Day Stochastic Fast 16.67 Slow 8.00 On a Sell
DJIA 14 Day Stochastic Fast 56.67 Slow 25.56 On a Buy
DJIA % Above 30 Day Average 16.67
DJIA % Above 10 Day Average 86.67
DJIA % Above 5 Day Average 83.33
Secondary Trend Indicator Rose 6 to Negative -18, On a Sell
Demand Power Up 7 to 402, Supply Pressure Fell 7 to 454 Sell
McClellan Oscillator Rose to Positive + 123.75 from + 55.69
McClellan Osc Summation Index – 2084.03
Plunge Protection Team Indicator + 13.80, an “OFF” signal
DJIA 10 Day Advance/Decline Indicator – 101.5 on a Sell
NYSE New Highs 8 New Lows 63
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated aSideways signal Wednesday, December 26th, 2018, and remain there January 2nd, 2019. The NDX Purchasing Power Indicator generated a Buy on December 26th, the NDX 14 Day Stochastic triggered a Buy signal on December 27th, 2018 and the 30 Day Stochastic triggered a Sell signal on December 4th. 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 Sell positions signal Friday, December 14th and remains there January 2nd. On Wednesday January 2nd, Demand Power rose 1 to 433, while Supply Pressure fell 4 to 461, telling us the rise was mild, and due more to a lack of selling interest rather than a strong urge to buy.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Sell signal December 14th, 2018, and needs to rise above positive + 5.0 for a new Buy. It rose to – 7.4 on Wednesday, January 2nd.
NDX PPI Rose 1 to 84.73, On a Buy
NDX 30 Day Stochastic Fast 13.41 Slow 8.51 On a Sell
NDX 14 Day Stochastic Fast 46.43 Slow 25.95 On a Buy
NDX 10 Day Advance/Decline Line Indicator – 7.4, On a Sell
NDX Demand Power Up 1 to 433, Supply Pressure Fell 4 to 461 Sell
RUT PPI Rose 1 to 95.71, on a Buy
RUT 10 Day Advance/Decline Line Indicator – 90.4 On a Sell
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Sideways(Neutral) signal January 2nd, 2019.
HUI PPI Flat at + 169.54, on a Sell
HUI 30 Day Stochastic Fast 90.00, Slow 70.00 on a Buy
HUI Demand Power Flat at 425; Supply Pressure Fell 2 to 420, Buy