Today’s Market Comments:
Stocks plunged Tuesday, December 4th, and flipped most of our short-term key indicators to new Sell signals. Trannies had their largest daily decline ever. The yield curve is inverting, normally a signal that a recession is starting. Housing is tanking. Volume was strong on the decline. It looks like corrective large degree wave 2-up finished Monday, and 3-down is starting. If so, this could be a powerful, nasty stock market decline. Normally we are in a Bullish seasonal period, so not sure how this plays out over the coming weeks. The Plunge Protection Team was buying with both hands and feet Tuesday, as bids were absent, so they stepped in to support markets. Wave 3-down has crash potential.
U.S. Markets will be closed this Wednesday, December 5th, in a day of mourning for George H.W. Bush. So there will be no reports on Wednesday.
Precious Metals and Mining stocks rose Tuesday, however our HUI key trend-finder indicators remain on a Sideways signal.
Our Blue Chip key trend-finder indicators moved to a Sell signal December 4th, 2018 and remain there Tuesday, December 4th. The Purchasing Power Indicator component triggered a Sell signal Tuesday, December 4th. The 14-day Stochastic Indicator generated a Sell on December 4th, 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 Monday, December 3rd, rising 6 points (out of a possible 9 points), to negative -6. It will need to rise above positive + 5 for a new Buy signal.
Demand Power fell 10 to 415 Monday while Supply Pressure rose 24 to 423, telling us Tuesday’s plunge in Blue Chips was powerful with deep pockets intervention buying significantly. This DP/SP Indicator moved to an Exit Long Signal December 4th, and remains there Tuesday, December 4th, 2018. The previous Sell signal identified the start of the October plunge.
The Plunge Protection Team Indicator moved to an “OFF” signal on October 25th, which means the PPT is not 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. 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 rose Tuesday. They generated a Sideways signal Friday, November 16th, as the HUI 30 Day Stochastic triggered a Sell signal October 24th, and our HUI Purchasing Power Indicator generated a Buy on November 16th. 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 Short signal Wednesday, October 24th. On Tuesday, December 4th, Demand Power was flat at 399 while Supply Pressure fell 1 to 411, telling us Tuesday’s HUI rise was weak.
DJIA PPI fell 27 to 12.12, on a Sell
DJIA 30 Day Stochastic Fast 60.00 Slow 75.33 On a Sell
DJIA 14 Day Stochastic Fast 53.33 Slow 72.22 On a Sell
DJIA % Above 30 Day Average 60.00
DJIA % Above 10 Day Average 53.33
DJIA % Above 5 Day Average 3.33
Secondary Trend Indicator Fell 8 to Negative -14, On a Sell
Demand Power Fell 10 to 415, Supply Pressure Up 24 to 423 Neutral
McClellan Oscillator Fell to Positive + 29.27
McClellan Osc Summation Index – 32.67
Plunge Protection Team Indicator – 14.0, on an “OFF”
DJIA 10 Day Advance/Decline Indicator + 41.5 on a Sell
NYSE New Highs 75 New Lows 373
Today’s Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators generated a Sell signal Tuesday, December 4th, 2018, and remain there December 4th, 2018. The NDX Purchasing Power Indicator generated a Sellon December 4th, the NDX 14 Day Stochastic triggered a Sellsignal on December 4th, 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 Long positions signal Wednesday, November 28th and remains there December 4th. On Tuesday December 4th, Demand Power fell 10 to 454, while Supply Pressure rose 20 to 444, telling us the decline was powerful with deep pockets intervention supporting prices aggressively.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Buy signal November 20th, 2018, and needs to fall below negative – 5.0 for a new Sell. It fell to + 14.8 on Tuesday, December 4th.
NDX PPI fell 39 to 148.69 On a Sell
NDX 30 Day Stochastic Fast 57.14 Slow 69.05 On a Sell
NDX 14 Day Stochastic Fast 52.38 Slow 74.5 On a Sell
NDX 10 Day Advance/Decline Line Indicator + 14.8 On a Buy
NDX Demand Power Fell 10 to 454, Supply Pressure Up 20 to 444 Buy
RUT PPI Fell 24 to 130.93 on a Sell
RUT 10 Day Advance/Decline Line Indicator + 14.4 On a Sell
Today’s Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Sideways signal October 25th, 2018.
HUI PPI Rose 1 to + 167.20, on a Buy
HUI 30 Day Stochastic Fast 45.00, Slow 34.44 on a Sell
HUI Demand Power Flat at 399; Supply Pressure Fell 1 to 411, Sell