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

Ryan Folds? - Republican Speaker Ready To Endorse Trump

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

House Speaker Paul Ryan has begun telling confidants that he wants to end his standoff with Donald Trump according to Bloomberg. Just 3 weeks after "just not being ready" to endorse Trump, and ...



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ValueWalk

CfA Statement on the FBI and SEC Investigation of Sen. Bob Corker

By Jacob Wolinsky. Originally published at ValueWalk.

OR IMMEDIATE RELEASE: May 25, 2016

Contact: Daniel Stevens, 202.780.5750, dstevens@campaignforaccountability.org

WASHINGTON D.C. – On Tuesday, The Wall Street Journal reported that the FBI and the SEC are investigating Sen. Bob Corker (R-TN) for his lucrative stock trades of real estate investment giant CBL Associates Properties, a real estate company based in Chattanooga, Tennessee.  Federal officials...



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Chart School

Conference Board Leading Economic Index: Increase in April

Courtesy of Doug Short's Advisor Perspectives.

The Latest Conference Board Leading Economic Index (LEI) for April was released yesterday, but we failed to post usual our update. Here it is ... a day late. The index increased 0.6 percent to 123.9 from March's downwardly revised 123.1 (previously 123.4) and small downward revisions were made to January 123.2 to 123.0) and December (123.4 to 123.3). The latest indicator value came in above the 0.4 percent forecast by Investing.com.

Here is an overview from the LEI technical press release:

The Conference Board LEI for the U.S. increased in April, wi...



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Phil's Favorites

Will a $15/hr minimum wage "unleash the robot rebellion"?

 

Photo licensed under CC BY-NC-SA 2.0 by Drpoulette

Ed Rensi, an Ex-McD CEO, insists that a "$35,000 robotic arm" is cheaper than hiring and training employees. According to Rensi, replacing employees with robots is cheaper - for McDonald's. Of course, the move to robotics is not necessarily "cheaper" for everyone else - e.g., taxpayers - who will ultimately absorb the costs that McDonald's shifts off its books. 

For purposes of argument, I'm accepting: 1) Robots are cheaper, and will probably continue to get cheaper. 2) Higher minimum wages will increase the incentive to replace human employees with robots. 3)...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Global Stocks Broadly Higher, Reversing Early Losses (Wall Street Journal)

Global stocks climbed Tuesday, while the dollar strengthened against the euro and yen.

Shares, dollar climb as markets play Fed waiting game (Reuters)

European shares were heading for their best day in over a month on Tuesday as the waiting game to see whether the U.S. raises interest rates again next month sent the euro to its lowest since March.

Asian shares had stumbled to near 2-1/2-month lows ove...



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OpTrader

Swing trading portfolio - week of May 23rd, 2016

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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Kimble Charting Solutions

Gold- Two-thirds odds prices fall on a support break

Courtesy of Chris Kimble.

CLICK ON CHART TO ENLARGE

Since the peak in 2011, Gold remains in a downtrend, creating a series of lower high and lower lows.

Gold’s rally in 2016 is attempting to break this 5-year falling trend, as it is attempting to break a series of lower highs.

Over the past 6-months, Gold could be creating a rising wedge pattern. This pattern two-thirds of the time, suggests lower prices are ahead.

...

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Digital Currencies

The Biggest Bitcoin Arbitrage Ever?

Courtesy of Chris at CapitalistExploits

Do you remember when you were growing up and all your friends were allowed Atari game consoles but you weren’t?

Well, I do and the things seemed as foreign to me as Venus. Mostly because the little time I managed to spend on the gaming consoles when my friends weren’t hogging them I found it all a bit silly. I never “got” computer games, and to this day still have poor comprehension of things like Angry Birds.

I suspect that many people around the world view Bitcoin in the same way as I view Angry Birds: with mild amusement and a general lack of understanding as to what the hell all the fuss is about.

I was thinking of this since a buddy of mine recently started ...



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All About Trends

Mid-Day Update

Reminder: Harlan 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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Biotech

This Is Why Biotech Stocks May Explode Again

Reminder: Pharmboy and Ilene are available to chat with Members.

Here's an interesting article from Investor's Business Daily arguing that biotech stocks are beginning to recover from their recent declines, notwithstanding current weakness.

This Is Why Biotech Stocks May Explode Again

By 

Excerpt:

After a three-year bull run that more than quadrupled its value by its peak last July, IBD’s Medical-Biomed/Biotech Industry Group plunged 50% by early February, hurt by backlashes against high drug prices and mergers that seek to lower corporate taxes.

...



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Mapping The Market

About that debate last night

Although we try to stay focused on finding and managing promising trade ideas, the comments in the comment section sometimes take a political turn (for access, try PSW — click here!). So today, Jean Luc writes,

The GOP debate last night was just unreal – are these people running to be president of the US or to lead a college fraternity! Comparing tool size? The only guy that looks semi-sane is Kasich. The other guys are just like 3 jackals right now. 

And something else – if Trump is the candidate, that little Romney speech yesterday is probably already being made into a commercial. And all these little snippets from the debate will also make some nice ads! If you are a conservative, you have to be scared now. 

Phil writes back,

I was expecting them to start throwing poop at each other &n...



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Promotions

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We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

PhilStockWorld.com features the most important and most interesting news items from around the web, all day, every day!

News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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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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