S&P
500 Index (SPX) Chart Analysis
Last week:
"If volatility
gives you gray hair, then this week
likely turned it all white. Huge declines
to start the week, a big next day rally,
Thursday another selloff and then Friday
a rally that ended the full week with
a +0.49% gain. That gain leaves the
S&P 500 Index (SPX) right at resistance.
The highs in May stopped the index at
about 2740. That is the next level needing
to be topped."
This week:
This week was another breakout week for
the S&P 500 Index (SPX) as well as
the Nasdaq 100 Index (NDX) which we will
look at here.
The daily chart below shows the early
May breakout rally for the SPX, and then
a top that held for the rest of the month
at about SPX 2740.
On Monday of this week the SPX gapped
up at the open and closed above the 2740
resistance level. That gain was followed
by a week of solid advances. The SPX closed
the week with a gain of +1.62%.
Last week we wrote: "Breakouts
or breakdowns from pennant patterns,
as seen in the below daily chart of
the SPX, typically point to the direction
the stock market will now take. That
points to an upside move soon to take
out those May highs."
The same chart pattern can be seen for
the NDX which broke above resistance in
early May, then traded sideways for the
rest of May.
On Friday of last week the NDX broke
out a second time above its May highs.
The NDX then posted another weekly gain
of +0.97%.
Small caps did not bother with breakouts
and have been outperforming for the entire
month of May.
Small caps did breakout above resistance,
the declining trend resistance line in
the below chart, in early May but since
have steadily moved higher.
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Wednesday's advance was a new closing
highs for small caps and for the full
week the sector added +1.49%.
The best news though is the NYSE Advance-Decline
Line. The NYSE has about 1600 stocks
and if its A-D line hits new highs, it
means most of the 1600 are participating
in the rally.
We cover the A-D line further on in
this report but look at the advance in
this chart!
Optimism is back in full swing and bulls are pouring into stocks. The CBOE
Volatility Index (VIX), also known and the fear index, dropped all the way
down to just above 11 during the week.
Last week's Friday advance after the
stellar jobs report and unemployment
numbers at 3.8% continued into this week.
Technology shares led the market higher
and although the sector suffered form
a bit of profit-taking on Thursday, the
NDX still ended the week with a new bull
market high.
Regularly
Followed Weekly Charts
NYSE Advance-Decline
Line
Market breadth again reached new highs.
This is a huge positive for stocks.
The NYSE Advance-Decline Line reached
a new bull market high. This indicator
tracks breadth and as such is extremely
important.
Good breadth is the number one indicator
of a healthy stock market.
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New highs for the A-D line means it
is not just a few powerful companies
pulling the market up, but that most
of the companies are advancing in the
broad NYSE index which has 1600 stocks.
Interestingly the A-D line also formed
a five-wave pattern and each down wave
ended with a higher low. Each up wave
has had a higher high.
There were pennant patterns in all
the major indexes as well as this A-D
line. All the breakouts are to the
upside.
The Nasdaq 100 Index Advance-Decline
Line also closed at a new bull market
high.
The NDX A-D line did not break out
to new highs until this week but it
did so in spectacular fashion as you
can see in the below daily chart.
CBOE Volatility
Index (VIX).
The CBOE Volatility Index (VIX) declined
-9.5% for the week, closing at 12.18.
During the week VIX dropped to 11.22.
Investors are again turning bullish.
They do not feel the need to cover
their positions with insurance in the
form of options.
Extreme bullishness is contrarian
bearish (eventually). We are not there
yet but it is something to watch.
Market Internals
The NYSE percent of stocks
that are trading above their 200-day
averages jumped +5.6% this week.
By the close on Friday
60.67% of stocks were trading above
their 200-day average line compared
to 57.43% in the previous week.
Sentiment Indicators
These are contrarian
indicators. Typically, when advisors
are mostly bullish, the markets are
near a top.
Note that these numbers
are from a week ago. They reflect
the preceding week's sentiment.
The
number of bulls remains high. Remember
that those who are neither bullish
nor bearish have bullish positions
and really should be considered bullish.
Add bulls and those not specifically
bearish and you get 82.3%
with at least some bullish market positions.
Fibonacci Support
/ Resistance Levels
We are now looking at "support
levels" from the correction lows.
Fib support levels on the weekly chart
are as follows; the 38.2% retracement
support at 2470, the 50% retracement
support at 2346 and the critical 61.8%
retracement support at 2222.
Market Moving
Economic Reports Released this Week:
Monday's factory orders report closes
the book on what was a solid April
for manufacturing in a month when the
headline -- an aircraft-distorted 0.8
percent decline -- definitely does
not tell the whole story. The split
between the report's two main components
shows a slight 0.1 percent increase
for nondurable goods -- the new data
in today's report with petroleum and
coal once again higher -- and a 1.6
percent decrease for durable orders
which is 1 tenth deeper last week's
advance report for this component.
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Wall Street?
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are unemotional
and are always
invested with the
trend, which ever
way it is headed.
Fibtimer's
timing strategies MAKE
MONEY in
BOTH advancing & declining
markets. No more
sleepless nights.
No more upset
stomachs.
We profit year after year after year. In fact, we have been timing
the markets successfully for over 25 years.
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Job openings rose 6.7 million in April.
the Labor Department said Tuesday,
the best ever in a series that lasts
18 years. March levels were upwardly
revised as well, to 6.63 million from
an initially reported 6.55 million.
Rising backlogs and a complementary
increase in hiring, both running near
3-year highs, gave a surprising lift
to the services PMI. At 56.8 for final
May, the index is up 2.2 points from
April and, even more surprising, is
up 1.1 points from the mid-month flash
which suggests that conditions accelerated
into month end. Output is also near
a 3-year high with new orders just
off a 3-year high.
The U.S. trade deficit shrank 2.1%
in April — before the Trump tariffs
took effect — and tumbled to
a seven-month low. But the gap is still
on track to widen in 2018 to the highest
level in a decade.
A small downward revision to output
and a small upward revision to hours
worked pulled down the second estimate
of first-quarter nonfarm productivity
to an even more paltry 0.4 percent
quarterly gain from 0.7 percent in
the first estimate. This in turn lifts
unit labor costs to 2.9 percent from
the first estimate's 2.7 percent.
Initial jobless claims fell slightly
in early June, keeping the rate of
layoffs in the U.S. near a 50-year
low. New claims dipped by 1,000 to
222,000 in the seven days ended June
2. Economists polled by MarketWatch
had forecast a 225,000 reading.
Household wealth topped $100 trillion
for the first time in the first quarter,
the Federal Reserve said Thursday.
Thanks to rising house prices, the
net worth of households and nonprofits
rose to $100.77 trillion from $99.74
trillion, offsetting the impact of
a decline in the stock market.
Conclusion:
Last week we wrote that we were looking
for another breakout in coming days
after the NDX broke higher on Friday.
Last weekend we wrote: "We
are looking for the SPX to push through
resistance at the May highs in coming
weeks."
That is what happened this week with
the SPX adding some +1.62%
Breadth is improving dramatically
with the NYSE Advance-Decline line
at new bull market highs.
The SPX portion of this
strategy is BULLISH. Aggressive traders
should be in the Rydex Nova S&P
500 Fund - RYNVX (or other bullish
S&P 500 index fund or ETF such
as SPY or RSP).
S&P 500 Index (SPX) Daily Chart
S&P 500 Index (SPX), Weekly Chart
Nasdaq 100 Index (NDX) Chart Analysis
Last week we wrote:
"Last week the Nasdaq
100 Index (NDX) had a bullish trend continuation
day on Wednesday. Lower lows than the previous
day and closing with higher highs than the
previous day. The NDX Advance-Decline Line
also again closed at a new bull market high.
This is extremely positive for coming weeks."
This week:
The Nasdaq 100 Index (NDX) powered through resistance
last Friday and this week, with the exception
of some Thursday profit-taking, managed to add
another +0.97%.
The below chart shows the early May breakout
from a bullish pennant pattern and declining
trend resistance line.
This time it was the May highs which had become
resistance and the NDX pushed through that level,
breaking through NDX 7000, last Friday. This
week the index added another +1%.
The NDX Advance-Decline line closed at a new
bull market high this week. When breadth is good
the index’s rise.
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what you need to beat the market!
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Bull & Bear
Timer
10 Year Results
Fibtimer Timing + 288.9 % |
3
Year Results
Fibtimer Timing + 59.2 %
|
1
Year Results
Fibtimer Timing + 35.5.%
|
Sleepless
nights as your investments are consumed
by a volatile Wall Street?
Consider Fibtimer's
trend trading services. Our trading
plans are unemotional and are always
invested with the trend, which
ever way it is headed.
Fibtimer's
timing strategies MAKE
MONEY in BOTH advancing & declining
markets. No more sleepless nights.
No more upset stomachs.
We profit year after year after year. In fact, we have been timing
the markets successfully for over 25 years.
Join us and start winning!
We
are currently offering HALF
PRICE to new and returning
subscribers.
--- only
$12.25 monthly for full year
Special
HALF PRICE Offer - CLICK
HERE NOW
|
|
MACD on the daily chart remained bullish during
the week and closed at 101.29.
On the weekly chart MACD remains in bullish territory
and last week posted a bullish crossover.
We have posted Fibonacci retracement "support" levels
for the advance from the February 2016 lows. Those
Fib support levels (weekly chart) are; 38.2% at
NDX 5980, 50% at NDX 5593 and 61.8% at NDX 5200.
Conclusion:
This week the NDX added another +0.97%. Remember
that over the prior two weeks the NDX gained +3.15%,
so tech stocks have jumped +4.12% in just three
weeks.
Add to this a breakout to new bull market highs
for the NDX Advance-Decline line and we are looking
at a freight train to the upside.
Rallies always end but so far we do not see any
signs of the advance slowing down.
The NDX portion of this strategy
is BULLISH. Aggressive traders should be in the
Rydex NDX 100 Fund - RYOCX (or other bullish NDX
100 index fund or ETF such as QQQ).
Nasdaq 100 Index (NDX), Daily Chart
Nasdaq 100 Index (NDX), Weekly Chart
|