Written by Gary
Midday Market Commentary For 06-20-2014
The SP500 melted up higher (1936.91) and the DOW made a new high of 16978.02 on anemic volume. I suspect the HFT algo computers have something to do with this as none of the traders I know are trading, much less going long.
By noon The $RUT was back into the green and the $NDX was fractionally in the red as everyone is getting ready to leave town.
Without a doubt, the biggest concern for all the ‘Sheeples’ out there is that they are caught up in the bull’s party and are not looking out for the ‘Black Swan’ that is going to cross the road.
After yesterday’s rally, the S&P 500 is at all-time highs as we approach the mid-year point.
However, as the volatility index moves to seven-year lows and stock volume is drying up, the market is feeling much too complacent at these levels.
There are also other danger signs for the market as we head into the second half of 2014. Caution is the watch word in the months ahead.
The main danger right now in the market is complacency. The volatility index just hit a seven year low and it feels like a lot of investors are starting to fall asleep at the wheel.
Over the past 18 months, earnings for the S&P 500 have climbed roughly ten percent while the market has climbed some 40%, including dividends.
The simple fact is most of the rally has been fueled by expanding earnings multiples, not earnings growth. In addition, this rally has occurred on lower and lower volume (See Chart Here).
The short term indicators are leaning towards the hold side at the midday. The all important signs of reversal, up or down, have not been observed so we are mostly, at best, neutral and conservatively holding. The important DMA’s, volume and a host of other studies have not turned and that is not enough for me to start shorting. The SP500 MACD has turned up, but remains above zero at 16.82. I would advise caution in taking any position during this volatile transition period although Barchart.com shows a 32 % buy. (down from 56% buy this morning) Investing.com members’ sentiments are 63 % bearish and Investors Intelligence sets the breath at 67.9 % bullish with the status at Bear Correction.
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The DOW at 12:00 is at 16966 up 44 or 0.26%.
The SP500 is at 1962.49 up 2.94 or 0.15%.
SPY is at 195.88 up 0.34 or 0.17%.
The $RUT is at 1185 up 1.03 or 0.09%.
NASDAQ is at 4360 up 1 or 0.02%.
NASDAQ 100 is at 3799 down 2 or 0.05%.
$VIX ‘Fear Index’ is at 10.67 up 0.05 or 0.47%. Neutral Movement
(Follow Real Time Market Averages at end of this article)
The longer trend is up, the past months trend is positive, the past 5 sessions have been positive and the current bias is elevated, but trending down.
WTI oil is trading between 106.63 (resistance) and 105.81 (support) today. The session bias is elevated and sideways and is currently trading up at 106.53.
Brent Crude is trading between 115.68 (resistance) and 114.48 (support) today. The session bias is depressed, trending down and is currently trading up at 114.70.
Maybe I’m Wrong – Justifying $2,000+ Gold by Jeffrey Dow Jones
Gold fell from 1322.50 earlier to 1307.10 and is currently trading up at 1316.00. The current intra-session trend is trending sideways.
Dr. Copper is at 3.123 rising from 3.071 earlier.
The US dollar is trading between 80.57 and 80.27 and is currently trading down at 80.49, the bias is currently elevated and sideways.
Real Time Market Numbers
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Written by Gary