The charts will be updated by
every Saturday. When no change to text, [NC] will be used. Click for
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The longer-term indicators below show
an DOWN MARKET (4 out of 6 indicators), within an
intermediate-term BULL CYCLE, within a longer-term
BULL TREND. The market did reaffirm its all-time high with good breath, which generally means the market will move higher. The BULL MARKET continues. More comments on the bull or bear
market are way below along with a chart from 1871.
A 20-year monthly chart gives a long-term perspective on the current action. A bull trend
was signaled in early July 2019 when the MACD cross occurred.The
trend almost turned six weeks ago, but then the Mexican tariffs were
announced -- then they were dropped.
[NC] Included in the chart are the 12-month and 36-month simple moving
averages. The MACD is based on the difference between the 8 and
30-month exponential moving averages with a red 7-month EMA of the
MACD, the signal line. Crossovers indicate a change in the primary
trend and seem to be a good indication of where the market is going.
The window at the right gives a magnified view of the recent monthly
four-year weekly chart of the S&P 500 index shows a record high on
9/21/18. On both Friday 4/26/19 and Thursday 6/20/19 a new record high was set. The previous bear cycle started
on 10/22/18 and ended on 2/15/2019. The chart shows a bull cycle.
[NC] Over 70 indicates an overbought
market, and the red down-arrows indicate when the 9-week RSI drops below
70 -- perhaps a time to take a short-term profit thus reducing risk. The
MACD shows when the bull and bear cycles occur -- a rise above or below
zero. The cycle determination is explained
in more detail on the Observations page. A
weekly chart should be used to determine the market trend. Then a
daily chart can be used to time entries or exits.
The technical indicators listed below give
a feeling for the strength of the overall market and whether there are
signs of a turn. A good confirmation of a turn from bullish to bearish is
the 52-week new lows exceeding the thresholds below.
- Price Trend of S&P 500 - DOWN
- Daily S&P 500 Moving Averages - UP in a
- Bull: price above 200-day SMA - BULL
- Bear: price below 200-day SMA
- UP: Both 50-day & 200-day EMAs moving up - UP
- DOWN: Both EMAs moving down -
- MIXED: averages not moving together
- Weekly MACD(5,26,0) Histogram + or - (see chart above)
- BULL Cycle
- Percent of S&P 500 stocks above their 200-day EMAs greater or less than 60% - DOWN
- Market Leadership (relative strength)
- Small caps generally lead large caps - DOWN
- Growth stocks lead value stocks (small-cap) - UP
- Technicals (QQEW, equal-weight Nasdaq 100) tend to lead the
general market (RSP, equal-weight S&P 500) - UP
- McClellan Summation of Advances & Declines of Nasdaq (slope)
- 52-Week Highs and Lows (excluding ETFs) - DOWN
- NYSE New Lows - UP if less than 45 for three days - DOWN
- Nasdaq New Lows - Up if less than 70 for three days - DOWN
- 3-day MA of Nasdaq NH-NL positive or negative - DOWN
- Consensus of the above - DOWN ( 4 out of 6 ) in a BULL Cycle
- - - - - -
Bull or Bear
Market?[NC] Now the question
Have we moved back to a bull market? The S&P 500 and Nasdaq
Index have broken through the resistance of the November highs and
crossed above their 200-day moving averages, which means the bear market is over.
And now the indexes have reestablished their move above their 200-day
moving averages, and they are way above a -20% drop that signals a bear
bull/bear trend is a long-term indicator and would eventually confirm
the market direction.
[NC] Alexander Elder gives the
long-term view that it has been a bull market since the
March 2009 lows. Now a bear market has started as John Murphy indicated on
Friday 12/21/18 when he said "This week's drop by all major stock indexes
below their early 2018 lows confirms that U.S. stocks have entered a
bear market. Some parts of the market have already crossed the -20%
threshold which also defines a bear market."
[NC] This chart gives a perspective on
past market drops during the last 11 years. A bear market is generally
considered to be a 20% drop from the last major high in the major
indexes. In addition, a confirmation of this would occur when the price
drops below the previous major low, which it did.
The chart below gives a really
long term perspective. These are true bull and bear markets and are
shown by the blue and red colors, respectively. The recent "dip" does
not look very significant on this chart. Note that the percentages
shown are the amounts above or below the regression line. The market is
currently way above this line. At some time it is likely to move below
it -- the next bear market.
The source of these charts is
given at the uppper right of the chart. This page is for
amusement only, and should not be taken as advice to buy or sell