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Posts Tagged ‘market internals’

SP500 Breadth Arc Divergences Signals

SP500 Breadth Arc Divergences Signals

Courtesy of Corey at Afraid to Trade

I wanted to show two quick charts of the internal S&P 500, highlighting a “Rounded Arc” formation along with a view of a potentially significant negative Breadth divergence at the highs.  Let’s take a look.

First, the 30-min chart with 3/10 Oscillator “Momentum” Divergences and Arc Pattern:


(Click for full-size image)

You can almost draw a full arc on the 3/10 Oscillator peaks as well, which forecast an arc prior to it happening.

Now, the oscillator is making new momentum lows, and the peaks in the oscillator are forming lower highs as price formed higher highs – that’s the sign of a classic non-confirmation which can be a bearish signal.

The fact that price is forming a clean ‘arc’ pattern also has bearish implications, given that arcs represent a gentle transfer from demand (buyers) to supply (sellers).

The expectation is that the arc formation has already, or will peak soon, and price will follow the arc now to the downside.

Let’s take a deeper look at market internals to see if we’re getting a similar picture.

Here is a 30-min chart of internal “Breadth”:

$SPX chart

The lower pane ‘indicator’ is actually a symbol – $ADD – which stands for “Advance/Decline Difference” (or the difference between NYSE advancing stocks minus NYSE Declining stocks) drawn as a line chart.

We see that breadth made a new high near July 15th with price at 930, though price has peaked at 1,018, breath has formed a series of lower peaks, which also lock in a non-confirmation or divergence just like the momentum oscillator.

The breadth divergence is more ‘important’ or significant than the momentum oscillator, because the momentum oscillator is price-based.

The implication is quite bearish, given that the S&P 500 is hovering beneath critical resistance at the 1,007 level as well as the 38.2% major Fibonacci level at 1,014.

Should price break above 1,020 solidly, it would disconfirm (overrule) these divergences, but until that happens – and it could – we have to assume resistance will hold and that the divergences will play out as they have so many times in the past.  This concept of ‘non-confirmation’ dates back to Dow Theory!

I describe these patterns in further detail to subscribers of the Idealized Trades and also this week’s Intermarket Technical Report, which…
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Zero Hedge

The "Cashless Economy" Is A Myth

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Via ConvergEx's Nick Colas,

The “Cashless economy” is myth.  Forget what you think you know about credit and debit cards, PayPal, bitcoin, Apple Pay and any other modern conveniences meant to displace physical currency.  The truth is that transactional currency ($1 through $20 bills) in circulation per capita today in America is essentially where it was, inflation adjusted, in 1994: $661 then and $649 today. Moreover, the Federal Reserve’s orders from the U.S. Treasury for small bills have grown faster in the last five years than the 20 year average: 4.5% annually versus a 3.5% long run growth rate.  This year should be no different, with the Fed ordering $4...



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Phil's Favorites

Recession is On the Way: Questioning One's Sanity; Beat the Crowd, Panic Now!

Courtesy of Mish.

In 2006-2007 I called for a recession. We got a big one. I called for another one in 2011, as did the ECRI. That recession never happened.

50% is not a very good recession predicting track record except in comparison to consensus economic opinions that have never once in history predicted a recession. Consensus opinion is batting a perfect 0.00%

Investigating the Record

By the way, the ECRI was late in calling the recession of 2007. They still deny it. And questions regarding the 2001 recession and ECRI have still not been answered.

I have talked about all of this before, and it's worth a recap, if for no other reason than to note the difficulty of calling recessions in real time.

February 24, 2012: ...



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Chart School

NYSE Margin Debt Declined in January

Courtesy of Doug Short.

Note from dshort: The NYSE has released new data for margin debt, now available through January. I've updated the charts in this commentary to include the latest numbers.

The New York Stock Exchange publishes end-of-month data for margin debt on the NYXdata website, where we can also find historical data back to 1959. Let's examine the numbers and study the relationship between margin debt and the market, using the S&P 500 as the surrogate for the latter.

The first chart shows the two series in real terms — adjusted for inflation to today's dollar using the Consumer Price Index as the deflator. I picked 1995 as an arbitrary start date. We were well into the Boomer Bull Market that began in 1982 and approaching the...



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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Market Shadows

Kimble Charts: Coal

Kimble Charts: Coal

By Ilene 

Chris Kimble's chart for KOL shows a recently beaten down ETF struggling to pull itself up from the ashes. As the chart shows, KOL has recently drifted down to levels not seen since the financial crisis of 2008-9.

Bouncing or recovering with energy in general, coal prices appear to have stabilized in the short-term. Reflecting coal prices, KOL has traded between $13.45 and $19.75 during the past year. Bouncing from lows, KOL traded around 2% higher yesterday from $14.26 to $14.48 on high volume. It traded another 3.6% higher in after hours to $15, possibly related to ...



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OpTrader

Swing trading portfolio - week of February 23rd, 2015

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Sabrient

Sector Detector: Sector rankings stay neutral with few bullish catalysts on horizon

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

Stocks are hitting new highs across the board, even though earnings reports have been somewhat disappointing. Actually, to be more precise, Q4 results have been pretty good, but it is forward guidance that has been cautious and/or cloudy as sales into overseas markets are expected to suffer due to strength in the US dollar. Healthcare and Telecom have put in the best results overall, while of course Energy has been the weakling. Still, overall year-over-year earnings growth for the S&P 500 during 2015 is expected to be about +8%.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 cha...



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Digital Currencies

MyCoin Exchange Disappears with Up To $387 Million, Reports Claim

Follow up from yesterday's Just the latest Bitcoin scam.

Hong Kong's MyCoin Disappears With Up To $387 Million, Reports Claim By  

Reports are emerging from Hong Kong that local bitcoin exchange MyCoin has shut its doors, taking with it possibly as much as HK$3bn ($386.9m) in investor funds.

If true, the supposed losses are a staggering amount, although this estimate is based on the company's own earlier claims that it served 3,000 clients who had invested HK$1m ($129,000) each.

...



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Pharmboy

2015 - Biotech Fever

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

PSW Members - well, what a year for biotechs!   The Biotech Index (IBB) is up a whopping 40%, beating the S&P hands down!  The healthcare sector has had a number of high flying IPOs, and beat the Tech Sector in total nubmer of IPOs in the past 12 months.  What could go wrong?

Phil has given his Secret Santa Inflation Hedges for 2015, and since I have been trying to keep my head above water between work, PSW, and baseball with my boys...it is time that something is put together for PSW on biotechs in 2015.

Cancer and fibrosis remain two of the hottest areas for VC backed biotechs to invest their monies.  A number of companies have gone IPO which have drugs/technologies that fight cancer, includin...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly.

Click here and sign in with your user name and password. 

 

...

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Option Review

SPX Call Spread Eyes Fresh Record Highs By Year End

Stocks got off to a rocky start on the first trading day in December, with the S&P 500 Index slipping just below 2050 on Monday. Based on one large bullish SPX options trade executed on Wednesday, however, such price action is not likely to break the trend of strong gains observed in the benchmark index since mid-October. It looks like one options market participant purchased 25,000 of the 31Dec’14 2105/2115 call spreads at a net premium of $2.70 each. The trade cost $6.75mm to put on, and represents the maximum potential loss on the position should the 2105 calls expire worthless at the end of December. The call spread could reap profits of as much as $7.30 per spread, or $18.25mm, in the event that the SPX ends the year above 2115. The index would need to rally 2.0% over the current level...



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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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