SPY - tools for swing trading a cap-weighted index

Steven Berry

The 3 pages of charts below display cumulative Advance-Decline breadth lines
which are the cumulative total of daily net Advance-Decline values

Common Stock Only indicators for the NYSE are calculated using approx.1800 common stocks
which are operating companies within the NYSE Composite Index (funds are excluded)
CSO indicators often present a more accurate internal picture for the NYSE Composite Index
The NYSE All Issues indicators are calculated using all issues traded on the NYSE

The McClellan Oscillator is the difference between the 19-EMA & 39-EMA of daily advances minus declines.
It reflects the short-term strength and direction of market liquidity.
A longer-term view is provided by the McClellan Summation Index, which is the cumulative total of the daily McClellan Oscillator values.
These indicators move within a trading range and often identify the overbought/oversold condition of the market

( McSum = McClellan Summation Index )

the dominant rule is: price will eventually follow the direction of the McSum, except for brief periods of price divergence

The McSum is neutral at the zero line,
bullish while above,
and confirmed bearish while below zero

* the distance down to the McSum zero line currently represents
one objective measure of the minimum downside risk

Confirmed sell signals are a lasting decline below the McSum zero line,
though price action has usually declined by a large amount by the time
zero is reached from the McSum peak above.

Large distances between the McSum daily chart values represent acceleration events in the A-D breadth decline or advance,
and the follow-on price impact has a high correlation with the McSum's direction, and usually has several days staying power

121 - XLK Technology with McClellan indicators & A-D line

4/18/17 - day #7 that daily closes remain below the 21-day sma,
which is near-term bearish

50-day sma support remains unbroken for the second consecutive daily close

PMO today achieves lowest level since mid-December, a bearish downtrend continues for the PMO
PMO remains above its zero line, bearish confirmation occurs
only when holding below the zero line

122 - XLF Financial with McClellan indicators & A-D line

10/3

alert: it is timely & prudent now to compare the 15-year chart history of the daily/weekly BB width
* pros & cons of this current BB expansion must be respected

9/19

PMO zero line and signal line crossover vigilance in the future is a must,
upside follow through by price action depends on the future PMO configuration steadily improving

5/17
today's re-test of $____ prior price low = the must hold below level,
for more decline potential

4/14

day #3 the lower BB was tested from above & bounced
day #3 the $___ March 27th pullback price low was re-tested,

intermediate-term bearish for US equities only when XLF price actually remains below the March low
ongoing bearish evidence for XLF is the XLF to SPY
ratio declining to new multi-month low, now at the early November levels

daily PMO resides below its zero line since late March, and continues to even lower levels which is bearish confirmation while the decline continues

PMO on 4/13 slightly violated the June/July 2016 PMO lows, & a future lasting hold below these prior lows will represent an important bearish confirmation

4/10/17 - Be objective, and act cautiously about believing in any high probability for a future price advance to the upside UNLESS the %b's clearly negate the current lower highs pattern over recent weeks by actually closing some future day in close proximity to the %b 1.0 line
1/26/17 - it is important bearish evidence that XLF today achieves a new record price high on lower momentum

123 - XLV Health Care with McClellan indicators & A-D line

4/18/17 - day #1 price failed to hold the 50-day sma support, bearish while below

the daily PMO continues to decline to lower levels since mid-March, and
remains above its neutral zero line

124 - XLY Consumer Discretionary with McClellan indicators & A-D line

4/18/17 - consecutive day #5 price fails to hold above the $____ mid-March high,
near-term bearish only while price action actually holds below the mid-March high

4/12/17 - PMO achieves a new March/April low today, which is clear
evidence of internal weakness while the PMO downtrend continues

* the daily PMO continues to decline to lower levels since early March, and
remains above its neutral zero line

125 - XLI Industrial with McClellan indicators & A-D line

4/18/17 - day #4 closing below the 50-day sma, near-term bearish

PMO achieves a new March/April low today, which is bearish
evidence while the PMO downtrend continues

the daily PMO continues to decline to lower levels since early March, and
remains only slightly above its neutral zero line
* vigilance recommended for the eventual PMO zero line outcome

126- XLP Consumer Staples with McClellan indicators & A-D line

4/12/17 - XLP price action today achieves a 15-day intraday price high
* this represents near-term bearish evidence for the overall US equity market,
because XLP is a go-to 'defensive play' by investors and institutions
( evidence that risk taking is further weakening )

** the XLP to SPY ratio's value is now located at its second highest value
since early November 2016, representing clear bearish evidence for
the major US equity indices unless the XLP/SPY ratio reverses to
the downside in the future

127 - XLE Energy with McClellan indicators & A-D line

4/21 - vigilance watch one possible setup for an upside price reversal:

be alert for future %b higher low positive divergence vs.
any lower lows by the XLE price action
* it is important that the %b higher low vs. XLE lower low is present at
the time of the actual daily close ... compare the current daily price close
with the prior close lows, and ditto for the %b daily closes

PMO remains below its zero line since the end of January, which is bearish evidence

* it is significant that the XLE to SPY ratio has declined below the prior lows,
be skeptical that future price bounces will have staying power until
the chart pattern for the ratio improves

128 - XLB Materials with McClellan indicators & A-D line

4/20

PMO hovers near its neutral zero line, which means
to be somewhat skeptical of the staying power of price bounces
until the PMO chart pattern improves to the upside

PMO remains above its zero line since early November, but has spent the
majority of this period below its signal line which is evidence of internal weakness

XLB to SPY ratio displays the April low is higher than the March low, bullish for XLB
price action while this continues

4/12/17 - today represents a downside acceleration chart event for the XLB:SPY ratio,
which is bearish evidence for XLB and for SPY.
Review the ratio's low in mid-October 2016 and mid-March 2017 for perspective.
Be alert for the lasting ratio outcome

129 - XLU Utilities with McClellan indicators & A-D line

4/12/17 - XLU price action today achieves levels in the upper region of the 12-day intraday price trading range.
* this represents near-term bearish evidence for the overall US equity market,
because XLU is a go-to 'defensive play' by investors and institutions
( evidence that risk taking is further weakening )

the XLU:SPY ratio today approaches the upper levels seen since early November,
representing further bearish evidence for the overall US equity market

201 - % chg since Oct 5 close for AAPL, MSFT, FB, AMZN, BRK/B, JNJ, XOM, JPM, GOOGL, GOOG

Chart #'s 201 to 203 display the % change since the October 5, 2017 close
for the 25 stocks in the S&P 500 index having the highest % portfolio weighting in the index.

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