Two HO signals this week on NYSE, and Nasdaq today

The definition that Jason and Tom are quoted here kicked in as well with a TS.  NYSE on Monday and today, Nasdaq today, and all within 7 day peak with negative NYMO, but not NYSI.  FWIW

https://www.marketwa...ndex-2019-11-14

Gonna be interesting. Everything that I track turned GREEN today except the SOX. Everything was RED at yesterday's close.

QQQ - Green.

NDX - Green.

Nasdaq - Green.

SPX - Green. Buy Signal.

OEX - Green. Buy Signal

SOX - Red.

RUT - Green. Buy Signal

NYSE - Green. Buy Signal

SPY - Green. Buy Signal

DOW - Green. Buy Signal

Wilshire 5000 - Green.

BKX- Green. Weak Buy Signal.

The QQQ, NDX and Nasdaq never got low enough to generate a buy signal by my standards. But, in a bull market, that is bullish. A mid-range cross to green. I have been expecting a high on the 31st......or a lower high. Didn't look possible for a while. Now it does. As is true with anybody, I can be very wrong. In my book, a failure here would be quite bearish. On the other hand, a lower high and then down would also fit that description (bearish). With a new high OR a lower high tomorrow, if either occurs.......and then a new high early next week would equal extremely bullish in my book. Don't put anything past the Bubblebutts. After all, they think it is QE all over again. Its not. It is QD. That is Quantitative Desperation. The FED must keep rates under control. And they have to prime the liquidity pump to do it. Europe and Japan are awash in bonds with negative rates. Boatloads. The European banks have to buy them even though the ECB apparently owns 40% of them. DB is STILL losing money hand-over-fist. They are holding billions of bonds that are GUARANTEED to lose money in a perfect world. Rates go up and that perfect world scenario turns into a nightmare because those bond prices will get toasted. Same thing that happened here in 2008 with the MBS fiasco.

Edited by Iblayz, 31 January 2020 - 12:24 AM.

Gonna be interesting. Everything that I track turned GREEN today except the SOX. Everything was RED at yesterday's close.

 

QQQ - Green.

NDX - Green.

Nasdaq - Green.

SPX - Green. Buy Signal.

OEX - Green. Buy Signal

SOX - Red.

RUT - Green. Buy Signal

NYSE - Green. Buy Signal

SPY - Green. Buy Signal

DOW - Green. Buy Signal

Wilshire 5000 - Green.

BKX- Green. Weak Buy Signal.

 

The QQQ, NDX and Nasdaq never got low enough to generate a buy signal by my standards. But, in a bull market, that is bullish. A mid-range cross to green. I have been expecting a high on the 31st......or a lower high. Didn't look possible for a while. Now it does. As is true with anybody, I can be very wrong. In my book, a failure here would be quite bearish. On the other hand, a lower high and then down would also fit that description (bearish). With a new high OR a lower high tomorrow, if either occurs.......and then a new high early next week would equal extremely bullish in my book. Don't put anything past the Bubblebutts. After all, they think it is QE all over again. Its not. It is QD. That is Quantitative Desperation. The FED must keep rates under control. And they have to prime the liquidity pump to do it. Europe and Japan are awash in bonds with negative rates. Boatloads. The European banks have to buy them even though the ECB apparently owns 40% of them. DB is STILL losing money hand-over-fist. They are holding billions of bonds that are GUARANTEED to lose money in a perfect world. Rates go up and that perfect world scenario turns into a nightmare because those bond prices will get toasted. Same thing that happened here in 2008 with the MBS fiasco.

Since I posted the above, it would be rather disingenuous of me to just bury my head in the sand. Clearly, the above didn't prove reliable this time. Blame it on whatever you want. Here are the updated results.

QQQ - Still Green.

NDX - Still Green.

Nasdaq - Still Green.

SPX - Barely Red.

OEX - Still Green.

SOX - Red.

RUT - Red.

NYSE - Barely Red.

SPY - Barely Red.

DOW - Still Green.

Wilshire 5000 - Red.

BKX- Still Green.

I did this work some 17-18 years ago. I am not even sure that I could repeat what I did when I developed the spreadsheets. One thing I NEVER did is this. I never changed the spreadsheet settings or formulas to make the results fit what just happened when the market went against the signals. I just kept paying attention and watching. A lot of years I was so busy running my business that I basically didn't have time to change anything anyway. But I kept watching, and learning. I regard this as being as reliable in regards to predicting short term market direction as anything that I have seen. I don't post it often because I don;t want to......and won't. It does make it look bad when I do and there is a failure. However, I will tell you what I have learned over the years.

I have learned (the hard way) to NEVER short a low after a failure like this when the latest market leading index(s) has(have) NOT turned red. Lately, that has once again been the Nasdaq and the NDX. BOTH stayed GREEN in spite of the hard drop. In addition, the OEX, DOW and BKX stayed on the Green side. Based on my experience, I would guess that the short term direction is up (as in a serious bounce). How far? I have no idea. Is this the beginning of a new or a short term serious bear or are we in for yet another maddening, sideways up and down correction? I have thoughts on that, but I have no way of reliably predicting how it plays out. Oh, and another of those time-tested observations. The SOX and RUT are both in the very oversold buy zone. When the SPX gets to this area, it often takes a couple of days of strengthening to "get itself out of the hole". Not so with those two, the SOX especially. The SOX can go from that extreme oversold area to a plus-two percent gain with relative ease. I have seen it many times. The RUT can easily do the same.