Written by Gary
Midday Market Commentary For 09-30-2014
Markets recovered from the morning doldrums to sit nicely in the green, but on low volume. It remains to be seen if the averages will remain above the red line however.
By noon the averages were trading elevated, but sideways on falling volume.
The signal yesterday was an up day, but the Doji candle at the noontime today, doesn’t bode well for a continuing upwards market as it is barely in the green and looking more like reversing signal.
The medium term indicators are leaning towards the hold side at the midday and the short-term market direction meter is very 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 flat, but remains below zero at -0.02. 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 ($BPNYA) is at 58.31. (Chart Here) Below support zone and apparently going further down. Next stop ~57 and then ~44, below that is where we see the markets crash.
StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 24.90. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009.
StockChart.com Overbought / Oversold Index ($NYMO) is at -45.32. (Chart Here) But anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold.
Chris Ciovacco says, “As long as the consumer discretionary ETF (NYSEARCA:XLY) holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy.” This chart clearly shows that dropping below 65.50 should be of a great concern to bullish investors.
StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) is at 49.88 %. (Chart Here) Not a good sign when half of the equities on the NYSE is BELOW their 200 DMA. Unless this downward trend reverses itself soon, we are going to see further downside.
The DOW at 12:15 is at 17120 up 49 or 0.29%. (the Dow is only up 2.2% in 2014)
The SP500 is at 1980 up 3 or 0.14%.
SPY is at 197.32 up 0.29 or 0.15%.
The $RUT is at 1113 down 5 or -0.42%. (the Russell is now down -5.5% on the month and -4.5% on the year)
NASDAQ is at 4515 up 9 or 0.21%.
NASDAQ 100 is at 4065 up 18 or 0.44%.
$VIX ‘Fear Index’ is at 15.46 down 0.52 or -3.25%. Bullish to 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 down and the current bias is negative.
WTI oil is trading between 94.90 (resistance) and 91.23 (support) today. The session bias is negative, volatile and is currently trading down at 91.42. (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 rose from 1205.01 earlier to 1220.51 and is currently trading down at 1207.50. The current intra-session trend is negative and volatile. (Chart Here)
Dr. Copper is at 3.019 falling from 3.060 earlier. (Chart Here)
The US dollar is trading between 86.34 and 85.62 and is currently trading down at 86.08, the bias is currently net positive and trading sideways. (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