Buy and Sell Signals, Risk Analysis, Money Flow, Breadth, Momentum

Michael Pitre Author is a PRO memberHas Had Over 50 Followers Rank: 21 Followers: 69 Votes: 95 Years Member: 11 Last Update: 24 July 2016, 17:07 Categories: Market Timing
Trend Analysis
Swing Trading

etfmaintrends.com

Saturday Notes...

In the very short term we are in a small sideways flag pattern which inside that pattern is a small head and shoulders pattern which is near breaking higher. See my short term charts at the top of page 4.

On the daily charts we are slowing grinding higher. The market is losing some momentum but this slow move higher can still last a while.

Viewed on a 2 hour chart the TSI...true strength index...crossed down and the market went more lateral but we are now testing resistance at 2176.

Weekly and monthly charts are still quite positive but the advance decline line is overbought.. One thing also that needs to be resolved is the Wilshire 5000 is testing but has not cleared prior all time high resistance.

Last week we had some solid economic numbers and the economy is gradually improving. Here is a summary from econoday.com regarding last week.

'Housing is only one plus of the early summer economy. Retail sales, don't forget, posted strong gains in June (up 0.7 percent ex-auto ex-gas) and June nonfarm payrolls surged 287,000 with this month's jobless claims pointing to another month of strength as well. And if the indications from new orders pan out, then the factory sector might even be joining the parade soon. Global demand appears to be only a secondary risk for a consumer-driven domestic-focused economy that may be building steam'

Meanwhile the business cycle index from imarketsignals.com is hitting an all time high which is very positive for the economic outlook as no recession is on the horizon in the foreseeable future.

Improving economic conditions is a key for the stock market.

Earnings have been coming in mixed and technology stocks are taking the lead now...XLK has shown a lot of strength.

As of today, the blended earnings decline for the second quarter for the S&P 500 stands at -3.7%.

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As long as this upward sloping bullish channel holds the market is in good shape.

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A Daily Chart of the major 'risk on' indexes.

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Key Chart For Volume Analysis...This chart gives a good understanding of what internals look like from the up volume vs the down volume...has done well big picture

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Market Sentiment With RSI 5 For VIX...RSI 5 got oversold for VIX and Sto for VIX has turned higher.

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Market Breadth Trying To Turn Higher...Breadth has not been strong enough to get the market through the layers upon layers of resistance.

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