For Sunday, December 2, 2018 

 
 


S&P 500 (SPX) & Nasdaq 100 (NDX) Timing
Aggressive - Both Bullish, Bearish & Cash Positions         Ranked #1 on TimerTrac


For Sunday, December 2, 2018                                Go to Website

Current Strategy Positions
Fibtimer currently has 13 successful strategies

  S&P 500 Position -        BULLISH
  Nasdaq 100 Position -   BULLISH
  SmallCaps Position -
   BEARISH
  U.S. Dollar Position -    BULLISH
  Bond Fund Position -     BULLISH
  Gold Fund Position  -    BEARISH

These positions were started over previous weeks.
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S&P 500 Index (SPX) Chart Analysis

Last week:

"The Thanksgiving holiday week is historically a bullish one. Not this time. After losses of -1.7% and -1.8% on Monday and Tuesday, the S&P 500 Index (SPX) took off with a rally on Wednesday. At one point nearing a 1.0% gain. But the selling began midday and by the close, the SPX was up only a fraction, and the Dow actually closed with a loss after being up as much as much +206 points."

This week:

It's hard to find something bearish about a 2+% gain like we had on Wednesday. It was not confirmed by a gain on Thursday is one red flag, though we did get a rally on Friday.

Wednesday's big rally was based on a news event. You cannot know ahead of time how a news event will affect the stock market. If it was possible, the rally would have occurred the day before.

News events do not usually change trends, though if the event is big enough it could.

On Friday the SPX still did not close above its 200-day average. Also, that average is nearing a bearish crossover by its 50-day average.

Yet the short-term trend is obviously improving and our aggressive strategy is moving back into bullish positions.

The question now becomes, is this the type of market action that will take us to new all-time highs and beyond: a so-called Santa Claus rally?

The Advance-Decline Line for the NYSE Composite Index is not supporting the current rally.

In fact it only just reached its 200-day average line

The weekly chart of the SPX has several bearish patterns. We discussed them last week and have them again here as they are important.

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1. There is a bearish divergence in the latest two SPX highs and MACD which did not make new highs. The weekly chart shows the new high in the end of September but a failure to make a new high in MACD.

2. There is also what looks to be a bullish five wave pattern (Elliott Waves) that ended in early October. If this pattern has completed we are looking at a decline, potentially, to SPX 2242. Not instantly of course, but over coming months.

3. The two-year long trend support line has been broken.

Look at the increase in volume during this decline and the lack of volume this week on the upside. The SPX 2600 level is where the February decline found support.

The Nasdaq Composite Index (COMPQ) had a bearish so-called death cross when the 50 day crossed below its 200 day average.

This broader index now joins the Russell 2000 Small Cap (RUT) with a bearish death-cross pattern.

According to data published Wednesday by Goldman Sachs’ Portfolio Strategy Research, the share of large-cap mutual funds outperforming their benchmarks fell from 63% in April to 33% through the end of the third quarter

General Motors will lay off 14,700 factory and white-collar workers in North America and put five plants up for possible closure as it restructures to cut costs and focus more on autonomous and electric vehicles.

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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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Regularly Followed Weekly Charts

NYSE Advance-Decline Line

The NYSE A-D Line managed to close above its 200-day line.

MACD has posted a bullish crossover but remains in bearish territory for the first time since March.


The Nasdaq 100 Index Advance-Decline Line continues to do much better than the NYSE A-D Line, this week moving back above its 50-day moving average line.

MACD is rising and has crossed into bullish territory.

CBOE Volatility Index (VIX)

The CBOE Volatility Index (VIX) is back below the red line set at VIX 20.0. Not by much though, closing at 18.52.

VIX is calling for continued volatility and appears to have not accepted this week's rally as a new lasting trend.


Market Internals

The number of stocks trading above their 200-day average rose as expected this week, but remains at very lows levels.

The losses substantially exceed the February-March selloff which is a worry.

Only 33.25% of stocks in the NYSE above their 200-day average lines is a disturbingly low number.

Consider that fully 66.75% of the 1600 stocks on the NYSE are now "below" their 200-day line.

Sentiment Indicator

This is a contrarian indicator. Typically, when advisors are mostly bullish, the markets are often 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 79.4% with at least some bullish market positions.

  • Investor's Intelligence Bull vs. Bears as of Nov 27, 38.3% bullish vs. 20.6% bearish.
    Bull vs. Bears in the prior week with 39.6% bullish vs. 19.8% bearish.

 

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 Fibtimer Timing  + 67.2 %

 

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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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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 2508, the 50% retracement support at 2375 and the critical 61.8% retracement support at 2242.

Market Moving Economic Reports Released this Week:

Employment gave a sizable boost to the national activity index in October which rose to a higher-than-expected 0.24 vs Econoday's consensus for 0.20 and against a revised 0.14 in September. Employment-related indicators contributed 0.19 to October's index vs only 0.05 in September as payroll growth more than doubled to 250,000.

Same store sales were up 7.9 percent year-on-year in the November 24 week, sharply accelerating by 1.7 percentage points to the strongest annual growth pace in at least 12 years. Month to date sales versus the prior month were up 0.8 percent, while the full month year-on-year gain rose to 6.7 percent,.

Case-Shiller's 20-city index posted a moderate and expected 0.3 percent monthly rise in September though the unadjusted year-on-year missed Econoday's consensus, moderating by 4 tenths to 5.1 percent vs expectations for 5.3 percent. The year-on-year rate, along with FHFA's 6.0 percent rate also posted this morning, are at roughly 2-year lows.

The FHFA house price index edged only 0.2 percent higher in September for the weakest showing since March this year and missing Econoday's consensus by 1 tenth. The year-on-year rate, at 6.0, slipped 3 tenths from August for the softest showing since January last year.

The consumer confidence index, at 135.7 in November, continues to hold in the mid-130s area and not far from the all-time high of 144.7 reached in 2000. November's strength is in the present situation which is a favorable indication for holiday spending, at 172.7 for an 8 tenths gain from October. Expectations, however, eased by 4.1 points to 111.0 as optimism over future job and income prospects is easing slightly.

New-home sales ran at a seasonally adjusted annual 544,000 rate in October, the Commerce Department said Wednesday. October’s selling pace for new single-family homes was 8.9% lower than September’s, although that report was revised upward.

A downtick in mortgage rates spurred homebuyers in the November 23 week, with purchase applications rising a seasonally adjusted 9 percent from the prior week to lift their unadjusted level back into positive year-on-year territory, 2 percent higher than in the same week last year.

Two wildcard components are slightly more exaggerated in the third quarter's revised GDP data while readings on the consumer and housing are mixed. At the headline level, the second revision to third-quarter GDP is unrevised at a very strong 3.5 percent annualized growth rate but inventories, contributing 2.27 percentage points to the total, added a little more than the first revision while net exports, subtracting 1.91 points, pulled down GDP by a little more.

After-tax corporate profits rose a year-on-year 5.9 percent in the third-quarter to $1.976 trillion without inventory valuation and capital consumption adjustments. When including inventory valuation and capital consumption adjustments, pre-tax corporate profits rose a year-on-year 10.3 percent to $2.318 trillion with after-tax profits at $2.074 trillion for a 19.4 percent gain.

U.S. pending home sales slid 2.6% to a reading of 102.1 in October from 104.8 in September, the National Association of Realtors said Thursday. That was the lowest since June 2014. NAR’s index, which tracks real estate contract signings, was down 6.7% compared to a year ago.

Initial claims are up for a third straight week, 10,000 higher in the November 24 week to a 234,000 level that is outside high estimates for 228,000. The 4-week average is up a sizable 4,750 to 223,250 which is suddenly the highest reading since July. There are no special factors distorting today's report.

Conclusion:

The SPX posted a solid rally this week completely erasing the prior week's losses.

Yet the SPX was not able to close above its 200-day moving average line.

The weakness in the breadth charts continues. Both the NYSE A-D line and the NYSE Stocks trading above their 200-day averages are near their lows.

The potential that we have finished a two-year bullish 5-wave Elliott Wave pattern (weekly chart below). If this is correct, the decline that follows truly could be substantial.

Last week we wrote: "Could we see a rally? Certainly. An oversold stock market can rally at any time. But the bearish indicators are such that any rally will likely reverse."

This week we had that rally and this aggressive strategy will enter a bullish position on Monday. When the traded index reaches breakout level we will trade it.

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:

"The Nasdaq 100 Index (NDX) has closed at a new low since the selling began back in early October. The NDX is down over 1170 points and 15.2% since early October. The index was down -4.95% this week alone and -7.4% in the last two weeks."

This week:

The Nasdaq 100 Index (NDX) rallied this week completely erasing the prior week's losses.

Interestinly, the weekly chart of the NDX posted a death-cross pattern when the 50-day average has closed below the 200-day average.

Yet the daily chart, while close, did not have the pattern. Next week will likely resolve this.

MACD on the volatile daily chart is now deep in bearish territory but had a bullish crossover this week.


Fibtimer HALF PRICE Offer!

Get Our Full Reports Every Weekend
plus Updates Every Trading Day

These FREE reports are great, but getting our timing signals daily is what you need to beat the market!

only $12.25 monthly for full year
Bull & Bear Timer
10 Year Results

Fibtimer Timing + 287.0 %
3 Year Results
 Fibtimer Timing  + 67.2 %

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


On the weekly chart MACD has had a steep bearish crossover and has closed in bearish territory.

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 6256, 50% at NDX 5804 and 61.8% at NDX 5352.

Conclusion:

We have what looks like a bearish double-top in the NDX on the daily chart. The index closed at a new correction low last week but reversed and erased all that week's losses.

A strong rally by any measure.

Yet the NDX remains below its 200-day average and as we wrote above, is threatening a death-cross pattern.

The gain this week has triggered buy signal for this aggressive strategy.

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

 


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