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Technical Watch Weekly Breadth Data - 4/3/15


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#1 fib_1618

fib_1618

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Posted 16 April 2015 - 10:53 PM

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Weekly Breadth Data, Week Ending April 3, 2015

It turned out to be a pretty much "ho hum" week of trading with the major market indices closing up by an average of .53%, week over week, with the mid caps and small caps holding much of their gains made on Monday while the large caps chopped around going into Friday's jobs report. For the month of March itself, the market was down by only .64% with the mid cap and small cap indexes providing gains of over 1% and closing at new record levels on a monthly basis.

A quick review of the breadth charts array shows that the NYSE Composite and NYSE Preferred advance/decline lines both closed the week at new all time highs on Thursday with the NYSE Bond CEF advance/decline line reaching a similar high point on Wednesday. The NYSE Common Only (-279), NYSE Specialty CEF (-203), and the NYSE REIT (-186) advance/decline lines are all within 1% of also seeing new all time highs as well. All in all then, the US markets continue to show high amounts of liquidity continuing to keep prices from moving lower in any important way, and as long as this continues, prices should remain buoyant for much of the month of April.

All of the international markets had a good week as India's BSE advance/decline line finally saw a bounce higher after showing weak action for much of the month of March in what should be part of a technical snapback to or towards the line of previous support seen on the chart. Both the Aussie and DAX advance/decline lines continued to move net sideways for the week showing that there is good balance between buyers and sellers right now while the FTSE advance/decline line remains nicely above its pattern of rising bottoms going back to October of last year. Overall we'll call the current trading action that of a "pause to refresh" before a resumption is seen in the direction from where these pauses had their start.

Looking over in the precious metals arena and we see that bad has turned to worse as the price of gold moved to a higher high on Wednesday while the Precious Metals and XAU advance/decline lines showed very little evidence of money supporting this technical reflex. Because of this, this asset class is now been upgraded to a red alert status from where a price collapse in the spot price of the metals themselves could be seen at any time to fill this ever increasing vacuum created by this negative breadth to price relationship.

So...with the BETS continuing to be whipsawed back and forth between neutral and this week's +30 accumulation reading, the market's participants continue to battle it out for ultimate control. However, with the "less deserving" small caps and mid cap indexes closing at new all time price highs on a monthly basis, along with the NYSE Bond CEF advance/decline line moving to new all time highs this past week, this would suggest that we are still quite a ways away from any kind of important top in equity prices and, in fact, we're probably closer to the beginning of another multi month trending advance then we are to our continuing to consolidate. Using the declining tops line on the BETS chart as a proxy then, any break above this line of negative influence should give us the "all clear" to becoming more aggressive in following the positive lead of money flow, and unlike the month of March which "went out like a lamb", the month of April could be one where we see solid gains when all is said and done on the 30th.

Have a great trading week!

US Equity Markets:

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US Interest Rates:

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US Real Estate:

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Precious Metals:

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Australia:

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England:

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Germany:

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India:

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Technical Watch's Breadth Data Review includes a weekend recap of hard to find breadth measurements from the New York Composite Index, the London exchange (FTSE), the Frankfurt exchange (DAX), Sydney's All Ordinaries index, and India's Bombay exchange (BSE). Charts are provided with a market narrative by Dave Breslaw and are annotated for additional clarity and suggested positioning. Also included with this service are occasional special posts of longer term data charts to provide a comparable historical context of how internal action of the markets (money flow) can have a direct effect on the direction of price itself. This service works hand in hand with the Chatting the Market subscription service as it provides additional global money flow insights found nowhere else on the internet. More information on subscribing to either or both services can be found by clicking here.

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