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VXX: Bought VXX 14C exp Jul 15 2016 on 4/28/2016 when VXX was near $15.18
Long Term: Bear Market, targeting SPX <666 by 2022
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ADX: Declining momentum (from Dec-Feb downturn), in a trading market, with bears narrowly on top
RSI: Middle of the road, neither overbought nor oversold. Near where we have been topping of late.
Candle: Bulls had their run but Bears ruled the beginning and end of the week
Volume: Very Weak, well below the 20 dma
Moving Averages: Close>100>50>20>200 period moving averages
% Bollinger Band: Upper portion of the band
Bollinger Band Width: Quite wide, no huge move expected here
MACD: Bullish at a positive value, histogram continuing to weaken
ADX: Potentially moving from a trading to (a negatively) trending environment, unless we stall here
RSI: Falling from middle of the road, neither overbought nor oversold.
Candle: Bears were out big Friday
Volume: Stronger, above the 20 dma
Moving Averages: 20>50>Close>200>100 period moving averages, close occurred below the 50 dma first time since 29 Feb!
% Bollinger Band: Bottom of the band
Bollinger Band Width: Still quite narrow but a tick higher, a large move at this scale is still on the radar
MACD: Bearish but at a positive value, histogram ticked lower
Tagged the 2043 pivot before the close
ADX: Negatively trending at the moment
RSI: Due for a bounce
Moving Averages: 100>50>200>20>Close period moving averages, becoming evermore bearish again
% Bollinger Band: Riding the bottom of the band
Bollinger Band Width: Starting to widen with the bearish move playing out
MACD: Bearish at a negative value, histogram ticked lower, but is at a higher level than 12 May.
ADX: Weakening negative trend
RSI: Rising to mid range
Moving Averages: 100>200>50>20>Close
% Bollinger Band: Near the middle of the Bollinger Band
Bollinger Band Width: Still quite narrow (and narrowing again), suggesting a big move could be on the horizon
MACD: Bullish with a negative value, been basing since late March
Most oversold on an hourly basis since late March, but on a MA(20) hour basis since only early May.
HYG:IEF compares risk on vs. risk off in the bond world. High Yield vs. Treasuries of 7-10 yr maturity. Looking at the weekly chart, its clear that there was a double top in 2010 and 2011 and we are much lower, nearing the levels seen in early 2009 (!!!!). The bond world is regarded as much more astute that the stock world.
Zooming in to the daily time frame, you can see the negative divergence of the MACD vs. the high in late April vs. mid March. It’s going back into a tradable range so we’ll have to keep an eye on future trends to see if negative momentum starts to build once again.
Despite a higher low compared to early April, number of stocks making new highs is trending lower, while the number of stocks making new lows is accelerating. Stock-only $NYMO shows a negative divergence with a lower low vs. early April, just like at the mid April peak vs. early March. While the stocks only summation index recently made a higher high, the Full STO made a lower low and is rolling over lower rapidly at this point.
All bad signs for the $NYSE stocks.
%Stocks above 200dma
Full STO for %stocks above 200dma in 5 different market classes is rolling over from the highest level since late 2014 (!!!). Awful time to buy the dip.
%Stocks above 50dma
A bad sign for stocks is the huge rolling over signature of the Full STO, the last time we saw a signal like this was late last fall. Judging by Full STO levels only, we are about where we were around 10 Dec 2015, though percent of stocks above their 50 day MA is much much higher. This suggests we are in the early innings of a steep drop.
%Stocks above 20dma
The number of stocks above their 20 dma across 5 market classes made lower lows. Full STO has been on a sell since for the past several weeks. We are getting near the point within the next couple of weeks where we should expect a tradeable bounce.
The market does not go up nor down in straight lines. Why? Because there are forces at many many degrees trending higher and lower at any one point. To try to filter out the noise we employ a top-down methodology to first pick out the big trends and then work down from there.
258 trading days / 360 days since the SPX 2137.2 May 19, 2015 All Time High.
The weekly chart doesn’t show imminent demise, but internally looking at stocks above the 200 dma, the trend is clearly down. Couple that with the numerous Hindenburg Omens I have observed since late 2014 through 2015 and the stat above, its obvious that we are in a Bear Market. Do me a favor, read my article on Hindenburg Omens, done my way, before commenting.
We lost the 50 dma, was it a 1 day shakeout or the start of a leg lower? Volume today was fairly high of late. ADX could continue to run higher. MACD on Daily has room to run down, or rebound higher. Like Number of Stocks above their 200 dma, the 50 dma version also correlates well to early Dec 2015 using Full STO levels, though coming off of higher levels.
The hourly chart looks setup for a rebound in the very short term looking at RSI, ADX and MACD. TRIN on the hourly scale is also getting quite oversold.
The number of stocks above their 20 dma is starting to get fairly low with FULL STO reaching oversold levels. Now it can stay this way for several weeks, but be ready for a rally when the tide on this chart turns.
VXX has been basing for a month and a half and really could start to see a lot of volatility come back to the market in a hurry. This is likely to play out over the course of weeks or months, not days.
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