Market Commentary: Markets Remain Elevated, But For How Long

Written by Gary

Midday Market Commentary For 09-26-2014

The averages have stayed in the green, but have sea-sawed sideways for the most part this morning. Scant news to move the markets one way or another and suspect the markets will finish this session in the green.

By noon the averages we about where the markets opened with little hint of any direction.

The medium term indicators are leaning towards the hold side at the midday and the short-term market direction meter is bullish. We remain mostly, at best, neutral and conservatively holding. The important DMA’s, volume and a host of other studies have not turned significantly and that is not enough for me to start shorting, but now I am getting very concerned. The SP500 MACD has turned down, but remains above zero at +0.89. I would advise caution in taking any position during this uncertain period although some technical indicators have starting to turn bearish.

Investing.com members’ sentiments are 70 % Bearish and it seems to be a good sign for being bullish. The ‘Sheeples’ always seem to get it wrong.

Investors Intelligence sets the breath at 55.2 % bullish with the status at Bear Confirmed. (Chart Here )

StockChart.com NYSE Bullish Percent Index ($BPNYA) is at 59.84. (Chart Here) Below support zone and apparently going further down. Next stop ~57 and then ~44, below that is where we see the markets crash.

StockChart.com S&P 500 Bullish Percent Index ($BPSPX) is at 69.80. (Chart Here) In support zone and testing.

StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 25.35. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009.

StockChart.com Overbought / Oversold Index ($NYMO) is at -77.86. (Chart Here) But anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold.

StockChart.com Consumer Discretionary ETF (XLY) is at 67.07. (Chart Here)

Chris Ciovacco says, “As long as the consumer discretionary ETF (NYSEARCA:XLY) holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy.” This chart clearly shows that dropping below 65.50 should be of a great concern to bullish investors.

This chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% – 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages.

Today it represents the lowest levels seen since the beginning of the October, 2011 rally. Eric Parnell says, ‘ If nothing else, given that relatively fewer stocks are trading above their 200-day moving average at a time when the market is just off of its all-time highs suggests that an increasingly narrowing group of stocks is driving the rally at this stage, which does not bode well for the future sustainability of the uptrend.”

StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) is at 48.51 %. (Chart Here)

The DOW at 12:15 is at 17012 up 65 or 0.39%.

The SP500 is at 1971 up 5 or 0.24%.

SPY is at 196.79 up 0.43 or 0.22%.

The $RUT is at 1114 up 4 or 0.33%.

NASDAQ is at 4482 up 15 or 0.34%.

NASDAQ 100 is at 4022 up 14 or 0.36%.

How the Popular ‘VIX’ Gauge Works

$VIX ‘Fear Index’ is at 15.42 down 0.22 or -1.41%. Bullish Movement

(Follow Real Time Market Averages at end of this article)

The longer trend is up, the past months trend is even, the past 5 sessions have been negative and the current bias is elevated and sideways.

How Oil Really Gets Priced

WTI oil is trading between 93.29 (resistance) and 92.23 (support) today. The session bias is neutral, trending up and is currently trading up at 93.11. (Chart Here)

Brent Crude is trading between 97.49 (resistance) and 96.47 (support) today. The session bias is neutral, trending down and is currently trading up at 96.73. (Chart Here)

Why Gold Will Rise When The Dollar Falls

– and –

The general consensus is that gold prices will actually fall in the next twelve months (Sept to Aug. 2015). Goldman Sachs estimates that gold will fall to $1,050 an ounce, a drop of nearly 19%.

Gold fell from 1231.66 earlier to 1212.98 and is currently trading down at 1214.80. The current intra-session trend is negative. (Chart Here)

Currency Corruption Weighs on Copper

Dr. Copper is at 3.037 falling from 3.052 earlier. (Chart Here)

The US dollar is trading between 85.70 and 85.23 and is currently trading up at 85.76, the bias is currently positive. (Chart Here) Resistance made in Aug., 2013 has been broken.

The markets are still susceptible to climbing on ‘Bernankellen’ vapor, use caution!

“Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation inequities, they should try to be fearful when others are greedy and greedy only when others are fearful.” – Warren Buffett

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Real Time Market Numbers

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Written by Gary