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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

* The content in my articles is time-sensitive. Each one shows the date and time (New York ET) that I publish them. By the time you read them, market conditions may be quite different than that which is described in my posts, and upon which my analyses are based at that time.
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* If the dots don't connect, gather more dots until they do...or, just follow the $$$...





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Friday, May 29, 2015

What's Ahead for the Rest of 2015 for the S&P 500 Index?

As shown on the daily chart of the SPX below, the 50-day MA has, for the most part, held as major support over the past 5 years. Until we see that level breached and held, the bulls will remain, essentially, in control of this market. Although, since the last round of QE stopped at the end of October 2014, this index has spent more time hugging, and circling tightly around, this MA than at any other time during these 5 years...signalling a weakening and, potentially, an end to this bull control.

Without the benefit of any further QE from the Fed, buyers will likely be reluctant to commit new money into this market, which is up 204.57% since the closing-low on March 3, 2009, as shown on the percentage-gained graph below. So, while the SPX continues to consolidate, we'll see the 50 and 200 MAs eventually merge until price, finally, breaks up or down. Once a bearish moving average Death Cross forms, we should see a significant drop in price. Until then, expect more of the same...and, my 2015 outlook for equities may very well come into fruition...at the moment, the SPX is up 3.01% year-to-date, as shown on the last percentage-gained graph...I had forecast an overall price increase of 4% for this year (it reached 3.49% on May 21st...the target high to be surpassed and held if bulls are to remain in control).

So, in a nutshell, I'd keep an eye on the 50 and 200 MAs and their spread (widening or decreasing), and the 4% target-price increase to gauge either weakness or strength for the SPX for the remainder of this year.

Wednesday, May 27, 2015

Make-or-Break Time for World Market Index

N.B. Important updates can be found on the World Market Index (the latest one is May 22nd) at this link...

FYI...yesterday's chart of the index shows a drop and close just below the 50 moving average...stay tuned for fireworks...

Wednesday, May 20, 2015

Biotech Nearing its Peak?

As can be seen from the Year-to-Date graph below of the 9 Major Sectors plus the Nasdaq Biotech ETF (IBB), IBB has outperformed all of the 9 Major Sectors, so far, this year on a percentage-gained basis (by a margin of almost 2:1 over the highest Sector performer, that being Healthcare).

Does this, alone, mean that Biotech has reached its peak for the year? To look further into that question, I present the following three Daily charts:
  1. Nasdaq 100  Index ($NDX)
  2. Nasdaq Biotech ETF (IBB)
  3. IBB:$NDX Ratio
First, we'll look at where the $NDX is sitting. Its all-time high is 4816.35. Price closed today (Wednesday, May 20th), at 4505.30 and is almost mid-way between the middle and upper channel (which began mid-November 2012). Over the longer-term, price can run up another 311.05 points before hitting the top of its channel and, at the same time, touching its all-time high by around mid-to-late August of this year (if it rises to and rides along the upper channel from now until then).

Secondly, price action on IBB has been very whippy since it hit its all-time of 374.97 on March 20th and is trading in a range that is sitting above a 200% external Fibonacci Retracement level (which currently forms major support at 341.64). We may see a final thrust of price up to retest its all-time high to form a double top (and sloppy triple top) before it, once again, runs into major resistance at the top of its channel. We could see some major profit-taking occur at that level, with possibly lower-lows made, as well, breaking below the 200% Fib level and the middle of its channel in the process.

The last chart shows the recent underperformance of the IBB compared to the $NDX. Price is sitting in between a 200% external Fibonacce Retracement level and the top of its channel. However, the Momentum indicator is showing recent strength of IBB, so I'd watch price action on this ratio chart to see whether it, either, breaks and holds above major resistance (above the 200% Fib level), or breaks and holds below major support (the top of the channel) for possible clues on near-term strength or weakness.

I think that by following all three charts above, you'll have a more complete picture of near-term and longer-term strength or weakness in Biotechs.

Friday, May 15, 2015

British Pound Running Out of Steam?

If you'd bought the British Pound back in mid-April of this year, you'd have made a pretty penny, as shown on the following Daily chart of $XBP...likely in anticipation of the British election, which was held on May 7th. Price closed at 153.79 on that day.

If price can hold above the 200 Daily Moving Average (156.59), the next resistance level is around the 162.50 price. However, we may see some whipsawing around the current price until the overbought indicators settle down a bit. And, this chart is still under the bearish influences of a Moving Average Death Cross formation, so price may simply be retesting the 200 MA before plunging, once again, possibly to the 50 MA (150.37), or lower...or it may stop at the above-noted close of May 7th before resuming its trek upward.

Monday, May 11, 2015

SPX:VIX Ratio: The Next Hurdle

170 is the next major resistance level to be overcome on the following Daily ratio chart of the SPX:VIX. This appears to be "make or break" time for SPX Bulls. 180 and 192 represent the next and final major hurdles (set in 2014) that will need to be overcome before Bulls can comfortably feel that volatility has been quashed while (if) the SPX resumes any kind of sustainable uptrend.

The following 60-Day 60-Minute chart of the SPX:VIX Ratio shows last Friday's large gap that will, ultimately, need to be filled at some point, since gaps on this timeframe tend to get filled.

As mentioned in my post of March 29th, 2100 is the "froth" level that the ES (S&P 500 E-mini Futures Index) will need to overcome. In the process, it will have to overthrow major resistance, which is formed by a double Fibonacci confluence level. At the time of writing today's post, price has yet to break and hold above Friday's high of 2113.50 and the all-time high of 2119.75 set on April 27th of this year.

Are volatile swings over with now? I wouldn't rule them out just yet until we see the above-mentioned levels comfortably broken and held...and backed up by larger volumes to support new money entering equity markets at these historically-high levels.

Monday, May 04, 2015

Where Does the U.S. Dollar Go From Here?

The USD may stabilize somewhat and swirl around this Fibonacci fanline at or near its current price level, as shown on the following Weekly chart, before, either, resuming its uptrend, or, perhaps falling to its lower Weekly Bollinger Band around 90ish. I'd watch the RSI to see if it remains above 50 to support a theory for higher levels.