- Rank: 45
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- Votes: 10
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- Last Update: 28 March 2020, 22:10
Market Breadth Analysis
General Market Commentary
Fed (monetary policy with ZIRP and unlimited QE) and the government (fiscal policy with $2T stimulus) have thrown everything at it and got a weak bounce to 20-day average (and 38% Fib retracement). Asset classes moving together (Chart 110) so no safe place in another downturn. Expecting another drop.
These are the likely signs to get back in (asterisk if true):
Chart 104 Momentum turning up*
Chart 103 VIX below 40, Bullish Percent above 40*, Summation above -300, A/D above moving avg
Chart 108 Bottom indicated, but expecting only a bounce like 4Q 2018
Most charts are to answer a question. Chart answers below.
No. Ans. Desc.
101 SELL Buy-and-Holders (fair warning that a recession may be coming)
102 SELL Investors
103 SELL Swing Traders
104 SELL Active Traders
105 No Aggressive?
106 No Defensive?
107 No Top?
108 ??? Bottom? (got a bounce)
109 Factors: Not stocks (but if stocks, mega cap, domestic, growth=QQQ)
110 Intermarket: Stick to cash
Other Asset Charts:
No. Ans. Desc.
111 ??? Bond (or maybe not)
112 OFF Real Estate
113 OFF Gold
114 OFF Foreign
115 ON Dollar
116-118 Quick view on sectors
119, 120 Sample charts
Simple Six Investing:
No. Sym Ans. Val
201 VTI OFF 5
202 TLT ON 8-
203 IAU ON 8
204 IYR OFF 3-
205 IEMG OFF 3
206 USO OFF 3
Pullback in strong uptrend: high SCTR (e.g., >70) with dropped RSI (e.g., < 70) (see example Chart 119) and a ideally with a character change on the 1-minute chart (see example Chart 120).
The book, "Trading in the Zone" by Mark Douglas. It is about the mental game.
Note: The profile says PRO but I am an engineer and not a financial advisor. Updates on weekends.
Finally: "It is enough to identify prevailing conditions and respond to them as they change, without any need to predict." -- John Hussman
All information is strictly for educational purposes.
20200321: Recession almost guaranteed. Depression a potential. Employment dropped hard but data lags.
[This chart is monthly data and only update mid-month after all new data is posted.]
20200328: Earnings negative (and will be dropping further). Bounce was 38% Fib retracement. Expect is is a bull trap.
20200328: Got the bounce. Not enough to turn A/D and Summation indicators bullish. Expecting further drop.
20200328: Most market "internals" still headed down and the bounce favored defensive. Resistance at the 20-day moving average.
20200328: The small upside momentum seems spent and most are rolling over.
20200328: Defensive still has some relative strength but the whole market is dropping so who cares?
20200328: No signs of a top.
20200328: Remember, 4Q 2018 had a few bounces before it was done (left side of chart). Need more bears before this is over.
20200328: Expecting upturns to look like the blue circles. We have a start.
20200328: Gold hanging in there but everything suffering. Would not trust any in another selloff. Stocks, bonds, gold, real estate moving together in this crisis environment -- so much for risk parity through asset diversification.
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