Today’s Market Comments:
Stocks bounced Wednesday, May 16th. Small caps hit a new high for 2018 and all-time. They look to have completed a Bullish Ascending Triangle pattern from January 2018. All the major averages have formed Triangles with the more likely probability these patterns are wave iv down within a rising trend-channel from 2015, and once complete, will breakout higher in wave v-up. The key question tonight is whether these patterns from January 2018 are finished or did they just complete wave d-up with e-down next. We need to see more price action before knowing the answer to that question. We show charts of these patterns in tonight’s report on pages 25 through 30. Our Blue Chip key trend-finder indicators remain on a Buy signal tonight.
Metals are finishing Bullish triangle patterns. Yesterday’s sharp decline in Gold took prices to the bottom boundary of its Bullish Ascending Triangle pattern, and was stopped cold there. See charts on page 31.
Our Blue Chip key trend-finder indicators moved to a Buy signal May 10th, 2018 and remain there Wednesday, May 16th. The Purchasing Power Indicator component triggered a Buy signal Friday, May 4th. The 14-day Stochastic Indicator generated a Buy on May 10th, and the 30 Day Stochastic Indicator generated a Buy on May 7th, 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 Wednesday, May 16th, up 3 points (out of a possible 9 points), at positive + 21, needing to drop below negative -5 threshold for a new Sell.
Demand Power rose 2 to 395 Wednesday while Supply Pressure fell 4 to 373, telling us Wednesday’s rise in Blue Chips was mild. This DP/SP Indicator moved to an Enter Long Signal Wednesday, May 2nd, and remains there Wednesday, May 16th, 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 were flat Wednesday, May 16th, working through the final moves they need to complete Bullish triangles. Silver’s triangle may be complete. They moved to a Sideways signal Monday, April 30th, as the HUI 30 Day Stochastic triggered a Sell signal April 30th, 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 16th, the HUI Demand Power / Supply Pressure Indicator moved to an Enter Short signal. On Wednesday, May 16th, Demand Power fell 1 to 392 while Supply Pressure rose 1 to 403, telling us Wednesday’s HUI move was mild.
DJIA PPI Rose 2 to + 55.27, on a Buy
DJIA 30 Day Stochastic Fast 66.67 Slow 68.00 On a Buy
DJIA 14 Day Stochastic Fast 86.67 Slow 79.44 On a Buy
DJIA % Above 30 Day Average 66.67
DJIA % Above 10 Day Average 83.33
DJIA % Above 5 Day Average 43.33
Secondary Trend Indicator Rose 3 to Positive + 21, On a Buy
Demand Power Up 2 to 395 Supply Pressure Fell 4 to 373 Buy
McClellan Oscillator fell to positive + 65.61
McClellan Osc Summation Index + 2151.66
Plunge Protection Team Indicator – 2.69, on an “OFF”
DJIA 10 Day Advance/Decline Indicator + 411.0 on a Buy
NYSE New Highs 125 New Lows 54
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicatorsgenerated a Sideways signal Thursday, April 26th, 2018, and remain there May 16th, 2018. The NDX Purchasing Power Indicator generated a Buy on April 26th, the NDX 14 Day Stochastic triggered a Buy signal on May 4th, 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 an Enter Long positions signal Monday, May 7th and remains there May 16th. On Wednesday May 16th, Demand Power rose 1 to 428, while Supply Pressure fell 4 to 406, telling us Wednesday’s 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 Buy signal May 7th, 2018, and needs to fall below negative – 5.0 for a new Sell. It rose to positive + 25.8 on Wednesday, May 16th.
NDX PPI Up 2 to + 224.93 On a Buy
NDX 30 Day Stochastic Fast 56.00 Slow 57.20 On a Sell
NDX 14 Day Stochastic Fast 65.00 Slow 60.80 On a Buy
NDX 10 Day Advance/Decline Line Indicator + 25.8 On a Buy
NDX Demand Power Up 1 to 428, Supply Pressure Fell 4 to 406 Buy
RUT PPI Rose 3 to +183.98 on a Buy
RUT 10 Day Advance/Decline Line Indicator + 305.9 On a Buy
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Sideways signal February 27th, 2018.
HUI PPI Flat at 182.89, on a Buy
HUI 30 Day Stochastic Fast 30.00, Slow 50.56 on a Sell
HUI Demand Power Fell 1 to 392; Supply Pressure Up 1 to 403, Sell