Written by Gary
Midday Market Commentary For 09-29-2014
DOW recovered 50% of its morning loses at one point and the SP500 has fallen below its 50 DMA. The morning opening sell-off may just be a market anomaly or it could be a wake-up call for something bigger, extremely difficult to call right now. The prognosis from last week was for this week to show a lot of weakness.
By noon the volume was occasionally anemic as the averages were ‘rolling over’ as investors continue to analyze their portfolios. Is the time to sell or buy?
Personally I think there will be some excellent BTFD this week sometime and would wait out this ‘noise’. I can ‘see’ several more sessions of negativity and would wait for the financial reports later this week.
The medium term indicators are leaning towards the hold side at the midday and the short-term market direction meter is fractionally bearish. 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 +0.62. 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 75 % Bearish and it seems to be a good sign for being bullish. The ‘Sheeples’ always seem to get it wrong.
StockChart.com NYSE Bullish Percent Index ($BPNYA) is at 59.40. (Chart Here) Below support zone and apparently going further down. Next stop ~57 and then ~44, below that is where we see the markets crash.
StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 24.81. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009.
StockChart.com Overbought / Oversold Index ($NYMO) is at -43.46. (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.
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.
The DOW at 12:30 is at 17028 down 84 or -0.49%. (the Dow is only up 2.2% in 2014)
The SP500 is at 1974 down 9 or -0.47%.
SPY is at 197.10 down 0.78 or -0.40%.
The $RUT is at 1115 down 4 or -0.34%. (the Russell is now down -5.5% on the month and -4.5% on the year)
NASDAQ is at 4497 down 16 or -0.34%.
NASDAQ 100 is at 4037 down 16 or -0.40%.
$VIX ‘Fear Index’ is at 16.03 up 1.18 or 7.95%. Neutral Movement
(Follow Real Time Market Averages at end of this article)
The longer trend is up, the past months trend is net neutral, the past 5 sessions have been negative and the current bias is negative.
WTI oil is trading between 94.28 (resistance) and 92.74 (support) today. The session bias is positive and is currently trading up at 94.18. (Chart Here)
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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 1223.88 earlier to 1216.58 and is currently trading down at 1217.90. The current intra-session trend is negative. (Chart Here)
Currency Corruption Weighs on Copper negative
Dr. Copper is at 3.049 rising from 3.013 earlier. (Chart Here)
The US dollar is trading between 85.92 and 85.58 and is currently trading up at 85.56, the bias is currently negative. (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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Written by Gary