Saturday, 24 September 2016

September 24, 2016 – Wel

September 24, 2016 – Welcome to my weekend market comment, an analysis tool I use in my own portfolio decisions, published free to the web every weekend before the New York opening bell. You can read the latest version each week by bookmarking http://cme4pif.blogspot.ca/. For full details read my disclaimer (link at the bottom of this page).

Well as predicted last week the buy the dip crowed bought the dip.There was a low volume pull back on Friday. There are some postive signals, the percent of stocks above the 200 day averge is holding up. Retails and consumers are not as strong as I would like to see. Industrials are running out of steam too.  
But there are some new signs in the market and they are concerning... lets see what the charts show. 



















101 Bull Bear
Bull market (dark green over red) and now the short term (light green) is up. Notice our long term indicators dark green 50 day and red 200 day are leveling off, not that that means much, one good Sept. rally and that could pick up again.  Bull market -- expect bullish outcomes.
103 NYSE High Low Market Forces
Bouncing back but the strength we saw last month might be gone. 

105 Non Farm Payroll
Lots of jobs! But beware this is lagging indicator. The smart money is gone before this turns down.

107 Industrial Production
Bullish but the 12 period green average says perhaps more pain yet. 

115 Renko
White brick after black brck, probably a new up trend or perhaps sideways. 
203 OBV
OBV is really lagging the market, too soon to worry but keep an eye on this. 
 !
207 VIX
VIX in a clasic up down right in time with the CCI indicator. Are we going to bottom under the red line again and return to more volitility?

209 VIX Evaluator
Nothing but strength. 

211 S&P500 over 50 day
Now 50% stocks are above their 50day MA, slightly up from last week. Possitve turning point?


213 Green Arrow
Only put new money to work when I draw a green arrow. With the TRIX red over gren a green arrow is not possible. You were warned. 

!
301 NASDAQ Summation
NASDAQ is at a record high. Very bullish for tech stocks.

303 Aggressive Defensive
back to risk on, bullish mode.

305 Consumer Bonds vs Equities
Bonds and consumer rebound, clearly the market likes esay money policy 

307 Bond Direction
Long term bonds are lagging but recent price action is strong. 

309 Sectors
As predicted, defensives are pulling ahead... hmm do I see the pros crowding around the exit?

311 Nations
Only Germany looks strong.

313 Major sectors
rotation out of U.S. equities in to emerging markets. 


! = Pay attention this chart is important this week.


What I Find Interesting

A recent article in Bloomberg showed how the U.S. standard of living is slipping by global standards. Apparently there is more to a great society than endless all you can eat wings, over sized vehicles and 500 tv channels. Who knew?

Health was a big issue, despite lots of "Tough Mudders" and a surge of interest in stand up paddle boards, Americans continue to tip the scale as the most obese society in history. 


Other issues include violence, urban crime, workplace safety, pollution and education standards. Of course there might be more to American culture,  I noticed that the U.S. got no points in culture for publishing some very artistic works in the Victoria Secret Catalogue. (I am a big fan).


What Works Now
Japan is doing very well the Vangaurd Japan index (tcker: EWJ) has been on a good march forward. 



What I Think
I think we are in one of the longest bull markets in history. I think we dodged a bullet by not raising rates and the market is celebrating. That said, the On Balance Volume tells me it mostly amateurs playing now and the TRIX on the Green Arrow chart is warning that this is not the full steam rally of the spring. The sector chart shows the action is in defensives an utilities, so that's lots of reasons not to trust this run up.  Still it is a bull market and you can't be too afraid. 

This week I am writing from London, heart of the European financial comunity










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Sunday, 18 September 2016

September 17, 2016 – Weekend Market Comment

September 17, 2016 – Welcome to my weekend market comment, an analysis tool I use in my own portfolio decisions, published free to the web every weekend before the New York opening bell. You can read the latest version each week by bookmarking http://cme4pif.blogspot.ca/. For full details read my disclaimer (link at the bottom of this page).

Well did you miss me? Yes there was no post last week, I was unable to get to an Internet connection. What a week to miss, the markets have corrected and we are now at a point where our oscillators are saying, "oversold" and the market is a bargain, and our trend indicators say that this could go on a while more, as they are bound to do. Lets look at the charts and try and put in our best guess. 






101 Bull Bear
Bull market (dark green over red) and now the short term (light green) is sharply down, Also the dark green looks like it is also now started to pull back meaning this could be a bigger picture problem. Now look at the lower window of the chart. Notice the slope has been decaying for a long time, the general trend of a pull back looks like it has begun. If you had used this declining slope as a indicator of future trouble you could have seen this pull back weeks ago.    That said, it is a bull market, and it is best to buy the dips in a bull market.  Bull market -- expect bullish outcomes.
103 NYSE High Low Market Forces
Perhaps the biggest concern is with this chart, we have not seen a red section in weeks, and due to that I have been very bullish, clearly we did have a red section last week and it is bad idea to get to crazy when there have been recent red splashes. 

105 Non Farm Payroll
Lots of jobs! But beware this is lagging indicator. The smart money is gone before this turns down.

107 Industrial Production
Newest numbers are not a strong as last report. 
!
115 Renko
Also deeply concerning. Our first black brick in weeks, but remember the last brick on a renko chart can change. 
203 OBV
OBV is slightly lagging the current market, but in general the red line is showing decreasing volume. Could show big trouble.  Too soon to worry but keep an eye on this. 
207 VIX
VIX is bouncing in a range, and looks like fear is subsiding, but this is far from stable.  

209 VIX Evaluator
Could this be a flatting for a turn? If so this could be a long term trend change. 

211 S&P500 over 50 day
Now over 32% stocks are above their 50day MA, slightly up from last chart two eeks ago, at 61%. Positive turning point or a long term fall off? Looks over done to me, ready for a bounce. 
 !

213 Green Arrow
Only put new money to work when I draw a green arrow. The TRIX has cross green arrows are not possible now. This is a sign of a long term trend change. 


301 NASDAQ Summation
NASDAQ has pulled back.  As you can see the breadth is deteriorating. The warning signs were on the wall long before the sell off. Tech actually is the only part of the bull market still showing life. 
!
303 Aggressive Defensive
High risk stocks are taking a beating, while dividend stocks and utilities continue to climb slightly. 

305 Consumer Bonds vs Equities
Bonds drop, consumer splat. 

307 Bond Direction
Strength in bonds overall but no recent upward interest. 

309 Sectors
Utility stocks lead. Expect new interest in defensives. 

311 Nations
International weak Canada bounces with investors seeking stability without recent hype.

313 Major sectors
All I can see here is that it could not be too bad if no one is pushing up the value of gold. 


! = Pay attention this chart is important this week.


What I Find Interesting

Acording to the Variant Perception web site we might be in for a pull back. The Institute of supply management produces a series of index reports on the health of the economy.  ISM services and Manufacturing numbers indicate the strength of the economy, in the past when both fell below 52 a recession was about to start. Well were are there.  Don't freak out yet, this is still a bull market, but keep an eye out. 










September is historically a strong month for the markets, but when things go wrong it can be the most dangerous too. Eight years ago on September 16, Lehman Brothers files bankruptcy sending the global economy in to the great reession. The great depresion is often sighted as the mid October sell off of 1929, but it was Sept 16 1929 was the actual peak of the market before the great depression. 






What Works Now
Teck resources, mention here a few weeks ago the Canadian miner has a recent change in fortunes. 



What I Think
September is has reputation as a tough month and boy is it iving up to it. On the 8th we were almost at a record high, mom and pop traders rushed in and the market sold off.  Volume is mostly in defensive areas like staples and utilities.  However, I expect the buy the dip crowed to jump in and buy the market Monday. However I think the party will be short lived, after 17 weeks of up, we a due for a rest, and many hedge funds will be locking in profits and repositioning this month. Keep an eye on the VIX and the price of gold, if this is the end of a big cycle they will rise. Otherwise I expect two weeks of weakness and recovery. Considering how strong tech has been it looks like the market is sill active. 





So if you are wondering what I do with my profits from the market....This week I am writing to you from a seaside cafe in Santorini Island, Greece.







You can learn more about my indicators by visiting the CME4PIF school by clicking here.

Don't squint, All graphics can be enlarged by click on them.


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Monday, 29 August 2016

August 27, 2016 – Weekend Market Comment

August 27, 2016 – Welcome to my weekend market comment, an analysis tool I use in my own portfolio decisions, published free to the web every weekend before the New York opening bell. You can read the latest version each week by bookmarking http://cme4pif.blogspot.ca/. For full details read my disclaimer (link at the bottom of this page).

Ho hum it is summer and the market on almost no volume is going nowhere. Look at this closeup of the recent market action:


So as you can see we are going no place. Friday's action was a little extream. 

By the way, I am in Europe visting friends and doing some investment banking work in London, so this and the next 4 market comments are likly to be short and late. Also I am learning to edit this work on a tablet and there will be some formating issues for sure. 








101 Bull Bear
Bull market (dark green over red) and now the short term (light green) is up sharply, but pulling back in last few days. Bull market -- expect bullish outcomes.
103 NYSE High Low Market Forces
Nothing but positive. In the right side highlight we see green is above is below yellow. Really positive.

105 Non Farm Payroll
Lots of jobs! But beware this is lagging indicator. The smart money is gone before this turns down.

107 Industrial Production
Bullish

115 Renko
Nothing but strength.
203 OBV
OBV is still with market, but what a day Friday. Bullish.
 !
207 VIX
VIX at a critical point, looks overdone but if it does not correct here could be wild ride next week. 

209 VIX Evaluator
Nothing but strength. But could this be a flatting for a turn?

211 S&P500 over 50 day
Now over 59% stocks are above their 50day MA, slightly down from last week 68%. Weaker.
 !

213 Green Arrow
Only put new money to work when I draw a green arrow. Notice the trix converge... danger?
flat

!
301 NASDAQ Summation
NASDAQ is near record highs but as you can see the breadth is deteriorating.

303 Aggressive Defensive
First sign of troubles as defencives regain a lead.

305 Consumer Bonds vs Equities
Bonds flat, consumer flat, not great.

307 Bond Direction
Strength in bonds but trend might break

309 Sectors
Its all about tech as the NASDAQ sweeps ahead. Expect NASDAQ stocks to loose steam soon.

311 Nations
International has small down tick after steady gains as U.S. market looks overbought.

313 Major sectors
U.S. equities are the only game in town.


! = Pay attention this chart is important this week.


What I Find Interesting

Last week the Economist Magazine ran a cover page article on how the U.S. many have yet another housing fiancial cisies in the offing. Click Here to Read

There is over 26 trillion of debt in the U.S.fiancail system related to mortgages. Thats bigger than the whole U.S. stock market system. While U.S. banks have tightend standards and are better capitalized there has been a move toward lower level unregulated broker mortgages that are backed by even shakier institutons than in the last mess. 


What Works Now
Well what has been working is high risk investing, small stock, technology companies, but trees don't grow to the sky and for most readers I would sugest this might be a good time to take some profits. 


What I Think
Last week I said, It is true things are moving a bit sideways after a strong run and I would have a long look at the green arrow chart, notice the trix converging? This might be the end of the summer rally? 

This week that trend continued. However this still is a very strong bull market, and it is hard to say if we are seeing  healthy pull back from some profit taking or a full scale exit before the dangerous early fall period. Of course that is the rub, buying opertunity or time to get lighter? I am going to wait and see, but no big risky bets right now. 






You can learn more about my indicators by visiting the CME4PIF school by clicking here.

Don't squint, All graphics can be enlarged by click on them.


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Saturday, 20 August 2016

August 20, 2016 – Weekend Market Comment

August 20, 2016 – Welcome to my weekend market comment, an analysis tool I use in my own portfolio decisions, published free to the web every weekend before the New York opening bell. You can read the latest version each week by bookmarking http://cme4pif.blogspot.ca/. For full details read my disclaimer (link at the bottom of this page).
It is the 200th Market Comment, can you believe I have posted the same 18 charts now for almost about 4 years and you have been reading them?







101 Bull Bear
Bull market (dark green over red) and now the short term (light green) is up sharply. Bull market -- expect bullish outcomes.
 !
103 NYSE High Low Market Forces
Nothing but positive. In the right side highlight we see green is above is below yellow. Really positive.

105 Non Farm Payroll
Lots of jobs! But beware this is lagging indicator. The smart money is gone before this turns down.

107 Industrial Production
Bullish

115 Renko
Nothing but strength.
 !
203 OBV
OBV is still with market. Bullish.
 !
207 VIX
VIX should bounce about this red line for a while but very bullish for now, could even head in to a new range. WOW

209 VIX Evaluator
Nothing but strength.

211 S&P500 over 50 day
Now over 68.6% stocks are above their 50day MA, slightly down from last week 71%. Strength.
 !

213 Green Arrow
Only put new money to work when I draw a green arrow. Notice the trix converge... danger?
flat


301 NASDAQ Summation
After a little pause, nothing but strength here. 

303 Aggressive Defensive
First sign of troubles as defensive regain a lead.

305 Consumer Bonds vs Equities
Bonds flat, but consumer has small uptick Bullish.

307 Bond Direction
Strength in bonds but trend might break

309 Sectors
Its all about tech as the Nasdaq sweeps ahead. Expect Nasdaq stocks to loose steam soon.

311 Nations
International has small down tick after steady gains as U.S. market looks overbought.

313 Major sectors
U.S. equities are the only game in town.


! = Pay attention this chart is important this week.


What I Find Interesting


Gordon Chang in World Affairs Journal has really hit the nail on the head with his insightful post China's Triple Bubble.

  • Beijing’s official National Bureau of Statistics appears to be posting fantasy numbers.
  •  Credit creation during the just-completed quarter was more than twice that in the previous quarter

What Works Now

Copart, Inc., headquartered in Dallas, Texas, is a provider of online vehicle auction and remarketing services. The Company provides vehicle suppliers, insurance companies, with a range of services to process and sell salvage vehicles over the Internet through the Company's Virtual Bidding Second Generation Internet auction-style sales technology.


Copart the leader in auto recycler and auction-services provider turned in double-digit revenue and earnings growth. This makes two quarters in a row of solid revenue growth after a sales stall in late-2014 through 2015. Management doesn't appear ready to rest on this rebound, with the company continuing to invest in more capacity.




Square
The maker of those super popular small business pointment of sale system. If you are wishing you bought Facebook at $35 this is your chance to get in, buy and hold this for a few years and hope for 10 to 1. Click here for chart




What I Think
Bull rages on. Except for a starting rotation in the aggressive defensive chart all looks very strong. At best you might talk about overbought, but that can go on a long time. 

It is true things are moving a bit sideways after a strong run and I would have a long look at the green arrow chart, notice the trix converging? This might be the end of the summer rally?






You can learn more about my indicators by visiting the CME4PIF school by clicking here.

Don't squint, All graphics can be enlarged by click on them.


Read My Disclaimer Here