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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...
please read my full Disclaimer at this link.

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Events

UPCOMING (MAJOR) ECONOMIC EVENTS...
* Mon. Feb. 20 ~ U.S. Markets closed for Presidents' Day Holiday
* Wed. Feb. 22 @ 2:00 pm ET ~ FOMC Meeting Minutes
* Wed. Mar. 1 @ 2:00 pm ET ~ Beige Book Report
* Fri. Mar. 10 @ 8:30 am ET ~ Employment Data
* Tues. Mar. 14 ~ 2-day FOMC Meeting Begins
* Wed. Mar. 15 @ 2:00 pm ET ~ FOMC Announcement + FOMC Forecasts + @ 2:30 pm ET ~ Fed Chair Press Conference
* Wed. Mar. 15 @ 8:30 am ET ~ Retail Sales
*** Click here for link to Economic Calendars for all upcoming events

Saturday, February 18, 2017

SPX On Track To Meet Its 2400 Target By Year-End

Further to my Market Forecast For 2017, the S&P 500 Index is on track to meet, or even overshoot, its potential target of 2400 by the end of 2017.

As noted on the Monthly chart of the SPX below, price has less than 50 points to go. Bullish sentiment remains strong, and, as of Friday's close, is confirmed by a higher swing high on the Momentum indicator, as shown on the Monthly SPX:VIX ratio chart below.

Monthly SPX chart

Monthly SPX:VIX Ratio chart

Wednesday, February 15, 2017

"Election-Flate" of U.S. Major Indices

From the following 1-Year Daily chart of the U.S. Major Indices and the graph depicting percentages gained/lost since November 8, 2016 (election day), you can see the huge gains that they've made since the election, except the Utilities Index. In spite of the relative flatness of Utilities since then, all of them remain above their 50-day moving average.

1-Year Daily chart

Percentages Gained/Lost graph from Nov. 8/16 - Feb. 15/17

The following 5-Year Daily chart of the SPX:VIX ratio shows that, while the SPX made an all-time new high today (February 15th), this chart failed to confirm the latest price spike. The RSI has fallen below the 50 level, and the MACD and PMO indicators have formed bearish crossovers...potentially signalling, either an imminent pause in equity buying, or some profit-taking in the near term.

5-Year Daily chart

Bottom line: The above-mentioned indices look like they're about to go parabolic in a continued price spike. If they do, I'd keep an eye on the SPX:VIX ratio to see whether we get a higher price confirmation, together with a new "BUY" signal on the technical indicators (e.g., a higher RSI swing high, and bullish crossovers on the MACD and PMO). If we do, it's important that these three indicators remain in such "BUY" mode on any near-term pause or pullback on the SPX as a gauge of subsequent market strength. Otherwise, we may see some larger profit-taking occur over the medium term.

Monday, February 13, 2017

ALERT: Today's World Market Index "Outlier"

A glance at today's (February 13th) market action among major world markets shows that the greatest gain, in terms of percentage, occurred in the Ukraine Index, as shown on the following data and charts.

The question is, does this precede some kind of positive political news? If so, there is considerable overhead price congestion/resistance to overcome around the 950-1000 level, and such news could, potentially, help price punch through that zone.

Source: Indexq.org

UAX Daily chart

UAX Monthly chart

Saturday, February 11, 2017

World Market Weak Spots

Further to my post of February 9th, the following charts and graphs will illustrate which world markets have lagged over a longer one-year period and a shorter year-to-date period. They are presented without individual comment, as they visually illustrate that point.

However, I would conclude that, while there are a couple of particularly weak European countries (namely, Portugal and Greece), most world markets, overall, are in a one-year uptrend, under accumulation, and above their 20 and 50-day moving averages.

Failure of any of these to, at least, hold above their 50-day moving average could see the beginnings of a reversal of this bullish sentiment. Europe may hold the key in terms of precipitating a negative domino effect on other world markets. Watch for, either a stabilization of Portugal and Greece, or continued weakness in the near term. As well, Italy, Spain, France, India and China are worth watching for signs of any eroding confidence.

U.S. Major Indices

1-Year Daily charts

1-Year Percentage Gained/Lost Graph

Year-to-Date Percentage Gained/Lost Graph

Major European Indices

1-Year Daily charts

1-Year Percentage Gained/Lost Graph

Year-to-Date Percentage Gained/Lost Graph

Emerging Markets + BRIC ETFs, and Brazil, Russia, India & China Indices

1-Year Daily charts

1-Year Percentage Gained/Lost Graph

Year-to-Date Percentage Gained/Lost Graph

Canada, Japan, UK, Australia & World Market Indices

1-Year Daily charts

1-Year Percentage Gained/Lost Graph

Year-to-Date Percentage Gained/Lost Graph

Thursday, February 09, 2017

World Market Index & SPX Hamstrung by U.S. Politics?

Further to my post of November 24, 2016, the World Market Index did, subsequently rally and is now stuck in a trading range between 1700 and 1750, as shown on the Daily chart below.

In that post, I mentioned the importance of a break and hold above 1750 as a potential signal of clear support for world equities, in the longer term, including that of the SPX.

You can see that a new "SELL" signal has just been triggered by the bearish crossovers of the MACD and PMO indicators.


The SPX is languishing just below the 2300 level, as shown on the Daily chart below, and the MACD and PMO indicators have yet to form a bullish crossover and trigger a new "BUY" signal.


Even if we see one of these indices break out, it's doubtful that sustained "buying with conviction" will prevail, unless we see the other one participate in such a rally, as well. That may not happen until both parties of the U.S. Congress begin to cooperate in a civil and bipartisan approach to move ahead with the new administration's agenda regarding the economy and security of its nation, instead of the political obstruction currently in play.

Tuesday, January 31, 2017

U.S. Congress: Focus on Economy NOT Political Obstruction

Economic data released today on the Chicago PMI (Purchasing Manager's Index) shows how much the U.S. economy is urgently in need of fiscal stimulation.

With barely a whimper above the 50 expansion level, the health of its economy is set to drop into contraction territory soon (as it did in 2009 following the depressed signals forecast by similar low numbers produced in 2007/08), unless Congress begins to cooperate and focus on real issues that support its claims of being number one in the world arena when it comes to economic (and military) might, instead of playing economically dangerous political games in unnecessarily obstructing the advancement of the new Trump administration, cabinet confirmations, and economic and security agendas.

In other words, Congress is attempting to discredit their own claims of world importance by playing silly games -- at the expense of its citizens who elected them to serve them and their interests and safety (what would you do if someone you hired to work for you refused to show up for work?) -- and end up looking transparently foolish, lazy, self-serving, and lacking creative win-win conflict resolution abilities in the process.

Source: Forex Factory

Source: Forex Factory

As a reminder (and as an adjunct to what I've mentioned above regarding Congressional shenanigans), the United States has yet to regain its Standard & Poor's AAA credit rating, which was downgraded to AA+ on August 5, 2011, in spite of gains made in the stock market since then. That was the first time ever that the government was downgraded below AAA.

We'll see if that's ever upgraded in the future and how hard Congress would work toward that end.

* UPDATE Feb. 7th: However, from the look of today's tweet and re-tweet below, it appears that, right from the outset of this new administration's four-year cycle, Democrats aren't interested in such a cooperative effort. It doesn't take a genius to conclude that the economy and security of the U.S. (and its citizens) will suffer, as a result.

Source: Wikipedia

Source: Wikipedia


Monday, January 30, 2017

SPX: Moving Averages May Hold Key To Short-Term Moves

The voluminous amount of executive orders, press releases and discussions with foreign leaders that has taken place in the White House since January 20th, as well as the extensive media coverage that has been generated, seem to hint that this pace may continue over the next four years.

Because of this, it may be warranted to scrutinize the price actions of the S&P 500 Index, for example, around its 5, 10 and 20-day moving averages, in order to get a sense of the degree to which day-to-day and end-of-month market sentiment may be influenced by political (and Federal Reserve) actions (on a shorter-term basis).

As at mid-day today, the SPX has declined and is currently retesting its 20-day moving average, after breaking out last week above its high-basing pattern from early December last year. The RSI is hinting of future strength, while the MACD and PMO indicators have yet to confirm that (watch for bullish crossovers of these two for such confirmation).

Today's pullback may also be in anticipation of the upcoming Fed rate announcement this Wednesday, as well as normal month-end profit-taking.

A drop and hold below, firstly, the 20-day moving average and then major support at 2250, together with bearish crossovers of all three moving averages and the MACD and PMO indicators, as well as a drop and hold below 50 on the RSI could signal further weakness ahead in the SPX.

Otherwise, price stability around 2250, along with the continuation of a fairly smooth uptrending 20-day moving average, should see prices move higher in the short-to-medium term.

SPX Daily

Wednesday, January 25, 2017

Charts vs Pundits & Dow 30 Index At 20,000

Despite some TV and media pundit and investor rhetoric about the imminent implosion of the U.S. markets under President Trump's economic agenda (in the months leading up to the November 8, 2016 Presidential election and, still, to date), we continue to see new market all-time highs being made, along with stabilization and advancement of world markets, in general, since the election.

The following charts illustrate that point. For example, the Dow 30 Index finally broke and closed above 20,000 today, while the S&P 500 Index remains on track to, potentially, achieve the 2400 level by the end of 2017 (as described in my post of December 1, 2016), and closed at an all-time high of 2298.37 today.

Dow 30 Index Daily

S&P 500 Index Monthly

As well, the SPX:VIX ratio also closed at an all-time high today, with the Momentum indicator confirming longer and short-term bullish sentiment in the SPX, as shown on the Monthly and Weekly timeframes (which I mentioned as something to monitor in my post of December 31, 2016).

SPX:VIX Ratio Monthly

SPX:VIX Ratio Weekly

The Nasdaq Composite Index and the Nasdaq 100 Index both closed at all-time highs today.

Nasdaq Composite Index Daily

Nasdaq 100 Index Daily

Even the World Market Index, after its latest and current rally produced another moving average Golden Cross formation in mid-January of this year, shows that foreign markets are also under such bullish influence.

World Market Index Daily

So, while a healthy divergence of pundit/investor viewpoints will, no doubt, continue, it may be wise to consider what the charts are portraying, as part of your "due diligence" trading/investing process. At the moment, momentum is favouring the bulls and will do so, until these charts prove otherwise.

Thursday, January 19, 2017

U.S. National Debt: Will An Autopsy Be Done?

Then (January 19, 2008)...which was the beginning of the financial crisis, culminating in a catastrophic drop of the S&P 500 Index, along with other U.S. and foreign stock markets, to the lows of March 2009 (which was stemmed by U.S. government bailouts of the financial system)...


S&P 500 Index Monthly

Now (January 19, 2017)...


The question is...did the cost of the government bailout (including all attendant Federal Reserve monetary measures...and government fiscal policies/programs enacted, if any) produce the kind of economic results/benefits, to date, that it intended? In other words, did the U.S. get its due "bang for the buck?" 

It seems to me that it would be prudent for the new Trump administration to include such an analysis/autopsy so as to incorporate the conclusions and considerations when preparing forecasts as part of shaping new domestic and foreign economic policies and programs for the next four years. In other words, will the U.S. get its due "bang for the buck" by January 2021? How will elected Senate and Congressional officials be held accountable for those results and what kind of transparency will they allow with regard to those questions? And, what will the U.S. National Debt look like then?

Lots of questions, as we approach the U.S. Presidential Inauguration at noon tomorrow...