Info!! A Await At Stance As Well As Stock Marketplace Strength

As nosotros tin terminate see, the CBOE equity put/call ratio has averaged well-nigh .60 since the 4th quarter of 2009. We've tended to spike higher than average (showing relative bearishness) close intermediate-term depression points together with convey tended to register below average (showing relative bullishness) readings around intermediate-term peaks. That ratio has been largely below average for a piece now, indicating that traders stay relatively bullish next the market's ascent to fresh highs.

Although we're trading relatively close those bull highs, the release of stocks registering fresh 20-day highs vs. lows has remained subdued. As I noted inwards my recent tweet, nosotros saw 969 stocks across the NYSE, NASDAQ, together with ASE brand fresh 20-day highs on Tuesday together with 398 score novel lows. Earlier this month, nosotros had over 3000 novel 20-day highs.

That existence said, the recent travail has suggested to a greater extent than sector rotation than outright correction: of the twoscore stocks inwards my handbasket (five from 8 S&P sectors), fully 32 are trading inwards uptrends according to my Technical Strength measure. (That indicator is besides updated each morning time prior to the marketplace opened upwardly via Twitter). We're besides hovering close bull marketplace highs inwards the advance-decline business specific to NYSE mutual stocks, every bit noted past times Decision Point. While see could constrain the near-term upside here, we're non seeing the sort of technical deterioration that by together with large precedes major marketplace selloffs.
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Info!! Indicator Update For February 23Rd

Last week's indicator update establish sector as well as indicator weakness, simply stressed that nosotros were non at an oversold grade as well as remained inwards a wide, choppy trading range. With the interruption of the 800 grade inwards the S&P 500 Index early on inwards the week, nosotros moved below that attain as well as stayed below for the week. That brought the Cumulative Demand/Supply Index (top chart) into oversold territory, though non at that -30 grade that has marked recent intermediate-term marketplace bottoms. The weakness has been broad, extending across all sectors, suggesting that the acquit marketplace remains intact every bit long every bit nosotros rest below the prior, extended trading attain mentioned above.

Another indication of the breadth of the marketplace weakness is the expansion of stocks making fresh 20-day lows across the NYSE, NASDAQ, as well as ASE (middle chart). We are seeing fewer novel lows on a 52-week dry reason than nosotros saw slow inwards 2008, as well as non all sectors convey seen fresh acquit marketplace cost lows. Similarly, field nosotros were notably weak inwards Cumulative NYSE TICK this by calendar week (bottom chart), nosotros remain higher upward the Nov lows. The same is truthful for the advance-decline lines specific to NYSE mutual stocks as well as S&P 500 issues. These divergences would popular off much to a greater extent than of import inwards my estimation should nosotros sustain a broad rally that keeps the S&P 500 marketplace higher upward its violated back upward at that 800 level.

As I emphasized the concluding distich of weeks, the peaks inwards the Cumulative Demand/Supply index convey occurred at successively lower cost highs; each rally inwards this acquit marketplace has failed to surmount the 1 previous. As long every bit that is the case, as well as specially every bit long every bit we're seeing weakening Cumulative TICK as well as expanding novel lows, it is premature to live pounding the tabular array on the long side.

I convey posted the daily as well as weekly SPY target levels to Twitter (free subscription via RSS) as well as volition update the indicators each morning time prior to the marketplace open. The market's relative volume--how electrical flow book compares to the average book for that detail fourth dimension of day--is really helpful inwards gauging marketplace volatility as well as the odds of hitting these targets. The relative book norms for this week's S&P 500 e-mini marketplace look below:

8:30 - 234,993 (62,792)
9:00 - 199,589 (48,899)
9:30 - 152,938 (48,688)
10:00 - 136,174 (65,293)
10:30 - 117,904 (59,114)
11:00 - 104,818 (40,222)
11:30 - 90,351 (33,155)
12 due north - 110,937 (37,560)
12:30 - 121,941 (46,688)
1:00 - 125,444 (58,883)
1:30 - 140,481 (61,592)
2:00 - 175,042 (50,129)
2:30 - 230,477 (84,999)
3:00 (15 instant period) - 99,318 (25,438)

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Info!! Indicator Update For October 6Th

the turn down is broadening, however, it is perilous to equate an oversold status alongside a purchase signal.

Late inward the week, nosotros did become roughly evidence of buying from the coin time period measure, which was independently corroborated past times the Cumulative NYSE TICK (third nautical chart above). My look at sectors together with my stock-by-stock analysis of coin time period suggests that this buying has been quite selective. We'll require to come across greater forcefulness inward the advance-decline numbers together with the numbers on stocks making fresh short-term highs earlier nosotros tin sack brand also much of this late-week buying. Indeed, alongside markets poised to opened upward sharply lower this AM, it appears that much of this rescue-package buying is beingness unwound.

In sum, weakness has expanded this week, non dried up. As long every bit this is the case, it remains premature to conclude that a durable bottom is at hand.
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Info!! Indicator Update For April 6Th

Last week's indicator review concluded, " We involve to run across an expansion of 20-day novel highs as well as an mightiness to concur the 800 degree inwards the S&P 500 Index on pullbacks before nosotros tin conclude that the electrical flow rally is something to a greater extent than than a tearing send marketplace bounce." We did indeed run across the marketplace rebound from early on weakness during the by week, non alone making novel toll highs, exactly likewise expanding the number of stocks making 20-day highs (second nautical chart from top) on continued forcefulness inwards the Cumulative NYSE TICK (second nautical chart from bottom).

There are other signs of forcefulness equally well. The S&P 500 sectors that I follow moved smartly into a bullish short-term trending mode, amongst sectors that reverberate themes of economical forcefulness dominating. As the real helpful nautical chart from Decision Point indicates, the advance-decline trouble for NYSE mutual issues (bottom pane, bottom chart) has likewise moved to novel highs for this rally.

As I've noted inwards before indicator updates, the mightiness of the marketplace to brand novel highs fifty-fifty when nosotros are overbought inwards the Cumulative Demand/Supply Index (top chart) is feature of bull marketplace action. Pullbacks inwards Demand/Supply larn out opportunities for farther buying as well as fresh toll strength.

We're at a dot inwards the Cumulative DSI inwards which it would non last surprising to larn ane of those pullbacks. To sustain the uptrend, nosotros should remain to a higher house the toll lows registered this by calendar week as well as nosotros should proceed to run across novel 20-day highs outnumbering novel lows. As long equally the indicators to a higher house proceed to exhibit strength, it is premature to fade this rally.

As always, I volition last tracking Demand as well as Supply, novel highs/lows, as well as short-term tendency direct each twenty-four hr menses prior to the marketplace opened upwards via the Twitter posts. Subscription is gratis of charge; the latest 5 tweets look on the spider web log page.
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