Even with a rather sharp setback the last two weeks, the indicator summary remains positive. Some indicators were on a verge of a change, but Thursday's rebound in the stock market kept them in bull mode. In particular, the volatility indices were on the verge of resistance breakouts on Wednesday. However, Thursday's rebound in stocks pushed these indices sharply lower to affirm the overall downtrend in volatility. So far, the decline over the last two weeks is deemed a correction within a bigger uptrend. Keep in mind that this indicator summary is not designed to pick tops or bottoms. It is just a general assessment of current conditions based on daily charts.
- AD Lines: Neutral. The Nasdaq AD Line broke below its mid October low, but the NYSE AD Line remains in an uptrend.
- AD Volume Lines: Bullish. The Nasdaq and NYSE AD Volume Lines both broke steep trendlines extending up from the August lows, but remain above their mid October lows.
- Net New Highs: Bullish. Nasdaq and NYSE Net New Highs dipped into negative territory this week, but the cumulative Net New Highs lines remain above their 10-day EMAs.
- Bullish Percent Indices: Bullish. All Bullish Percent Indices are above 50%. The finance sector Bullish Percent Index is still the weakest at 54.24%.
- VIX/VXN: Bullish. The S&P 500 Volatility Index ($VIX) and the Nasdaq 100 Volatility Index ($VXN) both edged above their prior highs (1-Nov) with a surge on Tuesday, but fell back rather sharply on Thursday. The downtrends remain until there is a convincing break above the November highs.
- Trend Structure: Bullish. QQQQ, SPY and DIA exceeded their April highs in early November. IWM hit resistance from its April high.
- SPY Momentum: Bullish. MACD(5,35,5) and Aroon (20) have been in positive territory since the second week of September. RSI dipped below 50 this week, but recovered to hold the 40-50 support zone.
- Offensive Sector Performance: Neutral. The consumer discretionary sector remains strong, but the tech sector took a big hit the last two weeks. Industrials rebounded, but finance remains on the fence.
- Nasdaq Performance: Neutral. The $COMPQ:$NYA ratio formed a lower high this week, but has yet to break last week's reaction low.
- Small-cap Performance: Bullish. The $RUT:$OEX ratio surged above its October highs this month and small-caps continue to show relative strength.
- Breadth Charts have been updated (click here)
This table is designed to offer an objective look at current market conditions. It does not aim to pick tops or bottoms. Instead, it seeks to identify noticeable shifts in buying and selling pressure. With 10 indicator groups, the medium-term evidence is unlikely to change drastically overnight. Previous turns include: Positive on 11-Sept. Negative on 5-February. Positive on 5-March. Negative on 11-June. Positive on 18-June. Negative on 24-June. Positive on August 6. Negative on August 13. Positive on September 3.
