DecisionPoint

DP Bulletin: New PMO BUY Signal on SPX - Scoreboards All Green!

It's official! All four DecisionPoint Scoreboards are on BUY signals in all three timeframes on the PMO and Trend Models. Tom Bowley and I continue to discuss during the MarketWatchers LIVE show about the hurricane force bull market winds. If these Scoreboards don't convince you, I'm not sure what will. Bull market rules definitely apply right now. What does that mean? Simply put, don't worry so much about overbought conditions and expect bullish conclusions to chart patterns and support/resistance levels. This is NOT to say that we have an unending bull market or are not vulnerable to a price shock. It simply tells you the temperature of the market is extremely bullish, so why buck the trend?

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DP Weekly Wrap: Not Out of the Woods Yet

Of my comment, "Not out of the woods yet," you might ask, "What woods?" The market, after all, did manage to grind higher this week, so what's the problem? The problem that I see is a persistent weakness in our intermediate-term indicators, but we will get into that later. More immediately, we note that this week higher prices were accompanied by much higher than average S&P 500 volume. This could be a sign of distribution.

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Don't Trust the Headlines: "This Stock is Going to Soar!"

I know we all have seen the commercials for the newest or best investment of the decade. Now we are getting emails flooding our inboxes claiming to have an "investment of a lifetime"! I'm not saying that these are traps or always bad, but I can tell you, before you believe the amazing claims, a look at the chart is a MUST. I was recently sent a question via email with an attachment of one of these such headlines on BioHiTech Global (BHTG). I generally can't review or answer all of my emailed chart suggestions, but the headline was just "too good". I had to see this chart. 

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Short-Term Indicators Bottom Quickly - IT Indicators Still Moving Lower

I promised to inform you when the Swenlin Trading Oscillators bottom in a concerted move to the upside and it happened already today. I pointed out in yesterday's blog article that the Swenlin Trading Oscillators (STOs) were now hitting oversold territory. This is exactly what we want to see--oversold indicators turning up. However, we want to also see intermediate-term indicators turning up or at least decelerating their descent and that hasn't happened, nor does it look like it will anytime soon. So what does this mean?

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Swenlin Trading Oscillators Reaching Oversold Levels

The Swenlin Trading Oscillator (STO) is an overbought/oversold indicator that can assist in identifying short-term tops and bottoms. There are two versions, one using advances and declines (STO-B), and one using advancing and declining volume (STO-V). DecisionPoint analysis considers these to be short-term indicators. Right now they are quickly reaching oversold levels not seen since August when we saw the rally begin a steady rise.

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Beware of the Parabolic Price Move - Intel (INTC) Example

As I was preparing for today's MarketWatchers LIVE broadcast this morning, Tom asked me to take a look at a handful of large cap breakout charts. The one that jumped out at me was that of Intel Corp (INTC). The chart pattern is worrisome. The recent move from its lows around $35 in August to it's close today at $44.37 is characteristic of a parabolic price pattern.

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DP Weekly Wrap: Another Blink Moment

Last week there was a one-day decline that didn't actually last a whole day. On Wednesday this week there was a rather more robust decline, but it didn't last a full day either, and the market took back a good chunk of its losses by the closing bell. As of Friday, the market was once again hitting new, all-time highs. Well, I should clarify that most broad market indexes were doing that, but two Dow components (Chevron and Merck) had a really bad day and kept the Dow nearly flat.

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Momentum Failing on SPX - New PMO SELL Signal - Dow Holds PMO BUY Signal

I updated the DecisionPoint Scoreboards yet again today. Yesterday saw the new PMO SELL signals on the NDX and OEX and today the SPX has followed suit by generating its own PMO SELL signal. You'll note that "one of these things is not like the others" on the Scoreboards as far as the short-term PMO. The Dow Industrials ($INDU) has been the titan of indexes with very little holding it back. Below is a tale of two very different charts.

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DP Alert: PMO SELL Signals on SPY, OEX and NDX - Climactic Indicators Suggest "Rally Pop"

Two important changes occurred on our DP Scoreboards today. The OEX and NDX both logged new PMO SELL signals as their PMOs crossed below their signal lines. I had expected the SPX to follow suit, but by an incredibly thin margin, its PMO BUY signal survived. The SPY wasn't so fortunate as a new PMO SELL signal appeared on its daily chart. So, I know you're asking, "You mentioned a 'rally', how can you expect a rally with all those new SELL signals?" A rally 'pop' is just that. A quick or sharp move upward in one or two days. This can develop into more, but I use climactic indicators for their climaxes which generally result in market "pops" up or down.

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