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$SPX Woah $Millions of Calls
By: Cheddar Flow | May 3, 2024
• $SPX Woah
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The 10 Top/Bottom NASDAQ 100 Index percent net change performers
By: Thom Hartle | May 3, 2024
• Today (8:34 CST), the 10 top/bottom percent net change performers in the NASDAQ 100 Index.
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Dovish Message Likely To Ignite Positive Wealth Effect From Equities And Home Prices
By: Hedgopia | May 2, 2024
Markets were on pins and needles as to if Powell would be open to the possibility of a rate hike. He hardly sounded hawkish Wednesday. A dovish message hardly helps cool down the positive wealth effect coming from equities and home prices. It could rather be helping inflation remain sticky.
A day prior to the conclusion of the two-day FOMC meeting, the employment cost index for the March quarter was released, and it came in hotter than expected. Private-industry total compensation increased 4.1 percent from a year ago. The series peaked in 2Q22 at 5.5 percent, which was a 38-year high, and has been north of four percent for 11 quarters now (Chart 1).
This comes on the heels of hotter-than-expected readings in recent months in both the consumer price index and personal consumption expenditures. Price increases are not dropping at the rate many had hoped.
Of late, several FOMC members have sounded alarmed by prospects of sticky inflation, with some even stating only one rate cut – at best – was needed this year; the March-meeting dot plot showed FOMC members expected three 25-basis-point cuts. The fed funds rate, after having been raised from a range of zero to 25 basis points in March 2022 to between 525 basis points and 550 basis points through last July, was once again left unchanged this week.
With most economic data coming in stronger than expected of late, markets were nervous if Chair Jerome Powell would open the door to the possibility of a hike, if the need be. He did not, stating in the post-meeting presser that “I think it’s unlikely that the next policy rate move will be a hike. I’d say it’s unlikely.”
When pressed what it would take for them to hike, he said, “I think we’d need to see persuasive evidence that our policy stance is not sufficiently restrictive to bring inflation sustainably down to two percent over time. That is not what we think we’re seeing.”
On Wednesday, markets were confused, and this was reflected in how equities traded. Stocks took off at 2:30, rallied hard for half an hour until they rolled over at 3:00. The S&P 500 reversed from up 1.2 percent at the session high to down 0.3 percent at close, with a massive shooting star (Chart 2); on Monday, sellers showed up at 50-day moving average.
Deep down, Powell’s body language suggests there is a clear bias toward easing. But they need data to cooperate. Apart from the economy refusing to show signs of deceleration, stocks have rallied huge since last October’s low, adding trillions in market cap, and that helps consumer mood/spending. Ditto with housing. Home prices are rising once again.
In February, using the S&P Case-Shiller home price index, US home prices firmed up 6.4 percent year-over-year. This was the steepest price appreciation in 15 months. In March 2022, prices were rising at a record 20.8 percent, before going the other way. For three months from April through June last year, prices dropped, albeit marginally (Chart 3). Since last July, the growth rate has been in acceleration.
The Federal Reserve has time on its side and likely takes time on rate cuts. One can argue the monetary policy is not restrictive enough to particularly impact equities and home prices, which influence inflation through the wealth effect. A dovish message at a time like this does not help.
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S&P 500 Election Year 2024 vs. 1968 & 2012
By: Almanac Trader | May 3, 2024
With all the college protests in the news it brings comparisons of 1968 to mind. 2024’s Big Election Year Q1 gains have already put the 2012 analog in my sights. Both were election years with somewhat correlated yet somewhat different narratives to 2024. The chart is from my members only webinar yesterday. S&P is clearly tracking 2012, not 1968 so far this year.
1968 was marked by escalations in Vietnam, the Tet Offensive, and protests on US college campuses and elsewhere. Sitting President Lyndon Johnson dropped out of the race on March 31. Robert Kennedy senior, the leading democratic candidate, was assassinated on June 6. George Wallace ran a formidable third-party candidacy garnering 13.5% of the popular vote and won 5 states and 46 electoral votes. But Q1 was down, and April was up.
In 2012 sitting President Barak Obama ran and won reelection. It was a year with the market driven by the Fed and interest rates. Zero interest rate policy (ZIRP) and quantitative easing (QE) were dug in deep. The Fed spun out QE3 and Operation Twist. Q1 was up big followed by a down April. Again, aside from the protests and wars 2024 is correlated more closely to 2012 than 1968.
This updated S&P 500 Election Year Seasonal Pattern chart underscores the market’s tendency to be weaker in April and May after big Q1 gains in election years 1956, 1964, 1972, 1976, 1988, 1996, 2012. However, the market is likely to be flatter than the green line above due to inflation, the Fed, interest rates, a prominent third party candidate and two ongoing wars. Page 26 of the 2024 Stock Trader’s Almanac reminds us that “War Can Be a Major Factor on Presidential Races. Democrats historically lost on foreign shores while Republicans lost at home.
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Money managers Increased their exposure to the US Equity markets since last week...
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NAAIM Exposure Index
May 2, 2024
The NAAIM Number
61.97
Last Quarter Average
87.84
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$SPY $2.8M OTM Call Volume for this strike + expiration has been rising steadily all week
By: Cheddar Flow | May 2, 2024
• $SPY $2.8M OTM Call
Volume for this strike + expiration has been rising steadily all week
*Above the Ask*
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The 10 Top/Bottom S&P 500 Index percent net change performers
By: Thom Hartle | May 2, 2024
• Today (8:34 CST), the 10 top/bottom percent net change performers in the S&P 500 Index.
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The AAII Investor Sentiment
By: AAII | May 2, 2024
Bullish 38.5%
Neutral 29.0%
Bearish 32.5%
• Historical 1-Year High
Bullish: 52.9%
Neutral: 37.4%
Bearish: 50.3%
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$SPY $1.2 Million Unusual Far OTM Put Ahead of FOMC
By: Cheddar Flow | May 1, 2024
• $SPY $1.2M Unusual Far OTM Put Ahead of FOMC
The majority of similar prints have been above or at the ask with stable volume
It seems like this is a hedge prior to the event
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S&P 500: Should long-term investors ignore the old adage "sell in May and go away?"
By: Isabelnet | May 1, 2024
• S&P 500
Should long-term investors ignore the old adage "sell in May and go away?".
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The net difference between bulls and bears reflects the overall sentiment and suggests a temporary pullback within a bullish market trend
By: Isabelnet | May 1, 2024
• Sentiment
The net difference between bulls and bears reflects the overall sentiment and suggests a temporary pullback within a bullish market trend.
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The 10 Top/Bottom NASDAQ 100 Index percent net change performers
By: Thom Hartle | May 1, 2024
• Today (8:33 CST), the 10 top/bottom percent net change performers in the NASDAQ 100 Index.
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$SPX - Micro-Chart Update of the 'Broadening' Plot formed within the lrgr one from yesterdays 5-Min chart. Here shown on a 1-Min...
By: Sahara | May 1, 2024
• $SPX - Micro-Chart Update
An update of the 'Broadening' Plot formed within the lrgr one from yesterdays 5-Min chart. Here shown on a 1-Min...
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More Pain Ahead for the NASDAQ100?
By: Dr. Arnout Ter Schure | April 30, 2024
• A counter-trend rally has most likely been completed, contingent on holding below at least $18100, and the index should be ready to drop to $15900+/-500.
Was That a Dead Cat Bounce?
In our previous update from early April (see here), we found that the NASDA100 (NDX) had peaked at $18464 on March 21, which was only 0.81% below the ideal target of ~$18615 we had set forth three weeks prior. As such, we concluded:
“…Thus, our preferred [Elliott Wave Principle] (EWP) count is for a larger top to have formed, … and [the Index] is heading for the ideal black W-4? target zone of $15900+/-200.”
Over the next seven trading days, the index lost an additional 5.8%, validating our warning, but it has since staged a 5% rally to yesterday’s $17820 high. Thus, is the correction over, or did we experience a “Dead cat bounce”?
Once again, the EWP can greatly help us. Namely, the rally from the April 19 low has so far been in three (green) waves. See the chart in Figure 1 below. Three-wave rallies are counter-trend rallies, aka “dead cat bounces.”
Thus, our preferred EWP count is for a larger top to have formed yesterday, the red W-b/ii, contingent on holding below the colored warning levels shown in Figure 1 above. The index should now be ready to embark on its red W-c/iii leg lower to ideally $15900+/-500, depending on the Fibonacci extension of this second leg lower.
Our less likely alternative is that yesterday’s high was only a fourth wave and a smaller decline to around $16700+/-100 awaits. The “countertrend rally and the next leg-lower” sequence can commence there.
Seasonality and the Anatomy of a Three-wave Rally
However, based on seasonality for an election year, where we look at the Dow Jones because it allows us to have 32 data points vs. only ten if we use the much younger NDX, the recent April 19 low and April 29 high were right on queue. See Figure 2 below. Moreover, as you can see from our X/Twitter profile here, we have accurately forecasted every market high and low since last week using a counter-trend scenario/EWP count. Forecasts like these dramatically help our premium members to stay on the right side of the market.
Figure 2. Dow Jones average seasonality for an election year since 1897, resulting in 32 data points.
Thus, six weeks ago, we found the NDX would likely top at around $18615, and we got $18464. Three weeks ago, we warned that a significant top could have formed and were validated with a 5.8% decline since. The current rally off the recent low counts best as a counter-trend rally and, together with seasonality, suggests the next leg lower to ideally $15900+/-500, is underway, contingent on holding below the warning levels for the Bears outlined in this article. Lastly, please note that a break below the October 2023 low tells us the bull market is over.
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May’s First Trading Day: S&P 500 and Russell 2000 Higher 69.2% of the Time
By: Almanac Trader | April 30, 2024
The first trading day of May has had a bullish history over the past 26 years. DJIA, S&P 500 and NASDAQ have all averaged around 0.4% on the day. S&P 500 and Russell 2000 have the best track records, up 18 times or 69.2% of the time since 1998. With an average gain of 0.21%, Russell 2000 is slightly weaker. May’s first trading day’s worst loss was in 2020. DJIA and S&P 500 shed over 2.5% while NASDAQ and Russell 2000 dropped over 3%.
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$SPX Hello there $145+ Million Calls
By: Cheddar Flow | April 30, 2024
• $SPX Hello there
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$SPX Large $40+ Million ATM Call Roll
By: Cheddar Flow | April 30, 2024
• $SPX Large $40M+ ATM Call Roll
This whale is likely rolling their 4/30's to 5/31 here for end of month rebalancing
Even though both are above the ask, the split, expiration change and timing make it a contract roll
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The 10 Top/Bottom S&P 500 Index percent net change performers
By: Thom Hartle | April 30, 2024
• Today (8:33 CST), the 10 top/bottom percent net change performers in the S&P 500 Index.
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The 10 Top/Bottom NASDAQ 100 Index percent net change performers
By: Thom Hartle | April 30, 2024
• Today (8:33 CST), the 10 top/bottom percent net change performers in the NASDAQ 100 Index.
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S&P 500: The current reading of 68.37 indicates that the US stock market is not yet overbought, suggesting that there is still upside potential
By: Isabelnet | April 30, 2024
• S&P 500
The current reading of 68.37 indicates that the US stock market is not yet overbought, suggesting that there is still upside potential.
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The Zweig Breadth Thrust is considered the granddaddy of thrusts, with an excellent record of signaling ends to corrections...
By: SentimenTrader | April 30, 2024
• The Zweig Breadth Thrust is considered the granddaddy of thrusts, with an excellent record of signaling ends to corrections. It got close to triggering this time but fell short.
Even so, its behavior so far is compelling and may be enough of a tailwind for bulls, even if it's far from "official."
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The S&P 500 Financials triggered a bullish signal when the percentage of stocks trading above their 10-day average surged above 80%, following more than 80% of the issues achieving an oversold condition. This surge from an oversold status occurred within the context of more than 80% of members closing above their 200-day average
By: SentimenTrader | April 29, 2024
• The S&P 500 Financials triggered a bullish signal when the percentage of stocks trading above their 10-day average surged above 80%, following more than 80% of the issues achieving an oversold condition. This surge from an oversold status occurred within the context of more than 80% of members closing above their 200-day average.
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The Market Greed/Fear Index stands at 60.07, which is now far from extreme greed territory, indicating a more neutral sentiment in the market
By: Isabelnet | April 29, 2024
• Sentiment
The Market Greed/Fear Index stands at 60.07, which is now far from extreme greed territory, indicating a more neutral sentiment in the market.
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In election years, historical data shows that the S&P 500 tends to perform strongly during the months of June, July, and August, as investors gain confidence from the clarity provided by the election process
By: Isabelnet | April 29, 2024
• S&P 500
In election years, historical data shows that the S&P 500 tends to perform strongly during the months of June, July, and August, as investors gain confidence from the clarity provided by the election process.
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$SPX - Latest Watching a Pot'l 'Diamond' Plot...
By: Sahara | April 29, 2024
• $SPX - Latest
Watching a Pot'l 'Diamond' Plot...
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For Equities To Repeat Last Week’s Feat, They Will Need Help From Both FOMC And Tech Earnings This Week
By: Hedgopia | April 29, 2024
In the latter part of last week, tech delivered, helping the major US equity indices rally big. Two issues could make or mar this week. The FOMC meets, and two more tech behemoths report earnings.
The FOMC meets this week, and what comes out of it could prove to be crucial for risk assets.
US stocks bottomed last October and took off post-December 13th FOMC meeting when Chair Jerome Powell made a dovish pivot. Soon, the futures market was consistently betting on as many as six 25-basis-point cuts this year – pricing in even seven at one point. This began to get modeled in analyst forecasts, and risk assets, including equities, shifted into higher gear.
Fast forward to now, futures traders now expect only one cut – in September (Chart 1). Earlier, the Federal Reserve tightened from a range of zero to 25 basis points in March 2022 to between 525 basis points and 550 basis points last July, even as it continues to shrink its still-inflated balance sheet.
Persistent strength in most economic data, including jobs, and sticky inflation has forced even the dovish FOMC members to change their tune and lean hawkish. There are some that are now vouching for no cut to maybe one cut. Until the March meeting, the dot plot expected three cuts this year.
It is possible Powell on Wednesday will lean hawkish outright, or at least not sound as dovish as in December or later. From risk assets’ perspective, the worse is if he openly espouses one cut, let alone talk about the possibility of a hike.
For tech investors, with tech-focused indices such as the Nasdaq 100 having rallied massively from last October’s low on optimism of loads of rate cuts, the interest-rate outlook matters. Thus the importance of this week’s FOMC meeting. Then, there is March-quarter earnings.
Last week, the big ones delivered. Facebook owner Meta (META) bettered the consensus estimates but its outlook came up short and was punished. Microsoft (MSFT) and Google owner Alphabet (GOOG), on the other hand, pleased investors with both their quarterly results and the outlook.
As a matter of fact, thanks primarily to tech earnings, the blended earnings estimates for S&P 500 companies as of last Thursday jumped $2.31 from nine days ago to $55.49, which is the highest since mid-January (Chart 2). This week, Amazon (AMZN) reports on Tuesday and Apple (AAPL) on Thursday. Going into this, AAPL’s estimates are flat to ever so slightly lower from a month ago, while AMZN’s is flat.
If both these events cooperate – FOMC and earnings – there is room for the Nasdaq 100 to continue to push higher.
Last week, the tech-heavy index jumped four percent to 17718. This followed four consecutive down weeks. Earlier, it posted a new intraday high of 18465 on March 21st but struggled to decisively break out of 18300s for seven weeks before sellers took control. By the 19th, the Nasdaq 100 ticked 16974, down 8.1 percent from the high.
Ahead, the 50-day, which is now slightly pointing lower, rests at 17939, with the index under the average for 10 sessions. At 18000 lies trendline resistance from last month’s high (Chart 3). Even in a scenario in which the index rallies, sellers probably will get active at this resistance.
The S&P 500 is the other one to get impacted the most by this. Both these indices are market cap-weighted, and the bigger companies are obviously given bigger weights. The top six – MSFT, AAPL, Nvidia (NVDA), AMZN, GOOG and META – account for 37.5 percent of the Nasdaq 100 and 28.1 percent of the S&P 500 (Chart 4).
This is a massive amount of concentration in just a select a few. This cannot be considered healthy from many respects, but the fact remains that they are also the ones minting a lot of money with healthy margins.
If AAPL and AMZN deliver this week and the stocks rally, the share of the six will only expand.
The two are reporting even as the S&P 500 finds itself just under the 50-day. Last week, the large cap index rallied 2.7 percent to 5100, with Friday’s intraday high of 5115 just about testing the average at 5124 (Chart 5).
The index has remained under the average for 10 sessions, having dropped for three weeks in a row before last week’s rally. Earlier, it ticked 5265 on March 28th and turned lower, failing to clear 5260s in three sessions over seven. Bulls put foot down at 4954 on the 19th – for a 5.9-percent drop from high to low.
Importantly, several daily indicators such as the RSI have now risen to the median. This is an opportunity for the bears to force the metric turn down, which will then lead to a reassertion of downward momentum. Bulls put their foot down last week, and they will have to do it again this week. For that, they will need help from both Powell and tech earnings.
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Market Situation Report: Impending Quantitative Tightening Tapering
By: Hedgeye | April 29, 2024
Quantitative Tightening (QT) was initiated in 2022 with the objective of draining excess reserves from the financial system. However, the extent of liquidity removal thus far has been negligible, and there are indications that the Federal Reserve may announce a tapering of QT operations in the upcoming week.
Despite the Fed's bond holdings decreasing by $1.6 trillion from their peak in mid-2022 due to QT, bank reserves, which represent system liquidity, have remained virtually unchanged. This can be attributed to money market funds effectively neutralizing a significant portion of QT's impact by absorbing a substantial amount of Treasury issuance from Secretary Janet Yellen, thereby preventing the need for private sector banks to do so. Additionally, Yellen has taken steps to mitigate duration risk in the system by disproportionately issuing short-term Treasury bills.
If the Federal Reserve announces a tapering of QT operations, coupled with the Treasury Department utilizing a portion of the current $941 billion balance in the Treasury General Account, it could result in a prolonged period of ample liquidity in financial markets.
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U.S. Stocks appear to be at an important Short-term/Tactical turning point within an ongoing Intermediate-Term correction
By: Macro Charts | April 27, 2024
U.S. Stocks appear to be at an important Short-term/Tactical turning point within an ongoing Intermediate-Term correction.
Weekly Sell signals remain active – a multi-week/multi-month correction is likely still in progress.
If a bounce develops, it should ultimately fail – an updated chart review suggests key levels to consider adjusting risk exposure.
China remains in a confirmed NEW Bull Market – this week’s price action was a classic continuation Buy signal.
We’ll cover some key Chinese Stocks that continue to hold my attention.
Bond Yields & Volatility remain in an uptrend and have room to move significantly higher.
We’ll cover potential projections & scenarios I’ve been tracking for the past few months.
The Dollar is in an uptrend after launching from a multi-month base.
Precious Metals & Miners may need to pause/consolidate for a while.
SECTION 1:
CORE MODELS & DATA
Core Risk was extremely oversold and turned UP on Monday.
As shared last week, the model plunged since triggering Sell mid/late March – one of the fastest drops in history.
With this turn UP confirmed, look for “a” bottom and potential sharp retracement bounce lasting ideally 1-2 weeks.
It’s possible this was “the” bottom and Stocks will now rally back to the highs – however I consider this a lower-probability scenario, and will present charts as to why.
Further, Weekly Sell signals remain active – a multi-week/multi-month correction is likely still in progress.
Another possibility: the current sequence could play out similar to the Buy signals in the correction that ended last October (see chart below).
Either way: Short-term odds are likely skewed higher.
Later in this report, we’ll cover potential key chart levels to consider adjusting risk exposure.
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The most overbought stocks in the S&P 500
By: Barchart | April 28, 2024
• Alphabet $GOOGL, Chipotle Mexican Grill $CMG, and Charles Schwab $SCHW are among this week's most overbought stocks in the S&P 500.
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Here's What You Need To Know About Last Week's Rebound
By: Tom Bowley | April 28, 2024
The Volatility Index ($VIX) is one of my key sentiment indicators and it has a history of accurately predicting corrections and bear markets. We've had neither without the VIX first clearing an important hurdle in the 17-20 range. Bear markets require a huge dose of fear and panic and the VIX acts as our stock market meteorologist - one that predicts major market storms as they're approaching. Throughout this entire secular bull market, the S&P 500's poor periods of performance have been marked by VIX readings above 20. Rather than repeat these results in this article, you can check out a Trading Places article that I wrote in November 2023, "What Are The Chances Of A Market Crash? This Indicator Says ZERO!"
On recent Trading Places Live YouTube shows and in my regular emails to our EB.com members, I've consistently discussed the significant increase in risk that accompanies a VIX close above 20. I do not take it lightly and neither should you. But check out what happened over the past few weeks as the VIX spiked and neared 20:
We had a straight-up move off the October 2023 low and the above chart simply reeks of slowing bullish momentum throughout the second half of Q1. I expected March weakness, but it was delayed into April. That final move lower in October was characterized by the big VIX increase - ultimately with closes on the VIX above 20. Once that VIX returned below 17, the selling and correction was over and the bull market resumed. Hence, the reason for my November article linked above.
When I evaluate a bounce like the one we had last week, I like to see if there's a resumption of the "risk on" market environment. Here are a few ratios that I like to follow and how they responded during the bounce:
These 3 ratios all bounced higher with the S&P 500, but all remain in downtrends that began before the S&P 500 selling did. That tells me that "risk off" still remains in play to some degree and we'll need further confirmation that a short-term bottom is in play. IF we do turn lower again, watch the VIX. If we see fresh new lows on the S&P 500 and the fear dissipates (ie, VIX remains below 20), I'd view that as a positive signal.
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$SPX - Zoomed in...
By: Sahara | April 27, 2024
• ... $SPX - Zoomed in...
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Election year seasonality has been spot on this month with $QQQ pulling back right on cue. Will April showers bring May flowers for the bulls?
By: TrendSpider | April 26, 2024
• Election year seasonality has been spot on this month with $QQQ pulling back right on cue.
Will April showers bring May flowers for the bulls?
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CoT: Peek Into Future Through Futures, How Hedge Funds Are Positioned
By: Hedgopia | April 27, 2024
• Following futures positions of non-commercials are as of April 23, 2024.
E-mini S&P 500: Currently net long 67.7k, down 6.4k.
Equity bulls’ mettle is being tested and it will only get intense next week. They put their foot down this week after the S&P 500 gave back 5.9 percent intraday from the March 28th high. The large cap index ticked 5265 in that session and turned lower, having tried and failed to clear 5260s in three sessions over seven.
Last Friday, the index tagged 4954. This week, it rallied 2.7 percent to 5100, with Friday’s intraday high of 5115, which just about tested the 50-day at 5124. The S&P 500 has been under the average for 10 sessions now.
Concurrently, several daily indicators such as the RSI have approached the median, and this is a decision time for the bulls – as well as for the bears. If the RSI, for instance, turns back down, then the latter will be eyeing at least last Friday’s low.
In due course, breakout retest at 4819 is just a matter of time. That was the prior high from January 2022 and the S&P 500 waited two years to surpass the old high this January.
Sentiment has taken a hit in recent weeks, but not low enough to signal a durable bottom (more on this here).
Nasdaq (mini): Currently net long 6.1k, down 2.4k.
The Nasdaq 100 had a topsy-turvy week, with a high of 17773 and a low of 17010. Until Thursday, it touched 17172 intraday; early on it that session, bulls were on the back foot reacting to Meta’s (META) March-quarter results. Then, come Friday, they came roaring back on the back of results from Microsoft (MSFT) and Google owner Alphabet (GOOG). In the end, tech bulls could not have asked for more (more on this here). The tech-heavy index shot up four percent for the week to 17718.
This came after four consecutive down weeks. The Nasdaq 100 posted a new intraday high of 18465 on March 21st but failed to sustainably break out of 18300s for seven weeks before rolling over. By last Friday, it ticked 16974, down 8.1 percent from the high.
Next week, Amazon (AMZN) reports on Tuesday and Apple (AAPL) on Thursday. If these results help and the index continues higher, the 50-day, which was breached 10 sessions ago, is at 17939. After that comes 18200, which is where trendline resistance from the March 21st high, rests.
Russell 2000 mini-index: Currently net short 36.1k, down 2.4k.
The Russell 2000 is back at 2000, closing up 2.8 percent this week to 2002; last week, it fell by the same amount from 2003. There is decent support/resistance at 2000. Earlier, after several attempts for a month through early this month, small-cap bulls failed to convincingly break out of 2100. Subsequently, the index dropped to 1932 last Friday.
As things stand, it is a toss-up between the bulls and bears. Inability to push through 2000 eventually opens the door to breakout retest at 1900. On December 13th, the index broke out of a 1700-1900 range in place since January 2022.
US Dollar Index: Currently net short 213, down 716.
The US dollar index suffered its back-to-back down week, although the decline has been nothing to write home about. This week, it closed at 105.80, versus last week’s close of 105.98 and 106.01 before that.
Dollar bulls were unable to build on a 1.9-percent jump three weeks ago. Selling pressure has picked up just north of 106. Ideally, they would have loved to test 107, which between early October and early November last year rejected rally attempts several times.
Earlier, the index bottomed at 100.32 last December, followed by a takeout three weeks ago of 103-104, which goes back to December 2016.
On the weekly, the path of least resistance is down.
VIX: Currently net short 18k, down 4.5k.
After three up weeks – each of them with long upper wicks – VIX tumbled 3.68 points this week to 15.03. The 50- and 200-day are right underneath – 14.84 and 14.87 respectively. If volatility bulls fail to save these averages, the index could test the 13 handle in no time. Next week is key.
Non-commercials, in the meantime, continued to reduce net shorts in VIX futures. At 18,000 contracts, holdings are at a 25-week low. In the week to October 31st last year, when equities were bottoming, these traders cut net shorts to 13,979 before accumulating again. Historically, VIX has tended to peak as these traders either go net long or get close to doing that.
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$SPX Millions worth of highly unusual put sell orders
By: Cheddar Flow | April 26, 2024
• $SPX Millions worth of highly unusual put sell orders
These were sold to open and the whales are betting that the S&P 500 will stay above 5015-5040 into end of next week
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$SPX A sudden change of scenery
By: Cheddar Flow | April 26, 2024
• $SPX A sudden change of scenery
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Investor Sentiment Takes Hit, But Yet To Hit Meaningful Low To Signal Durable Bottom
By: Hedgopia | April 26, 2024
After a ferocious rally from last October’s low, US equities gave back some of the gains this month. This has impacted bullish sentiment, but not enough to make a durable bottom in stocks.
The S&P 500 shed 5.9 percent from its March 28th peak before finding a footing this week. Earlier, from the October 27th low of last year, the large cap index shot up 28.3 percent. Big picture, April’s giveback is nothing given the five-month scorching rally.
Between late-March and early-April, bulls began to face difficulty at 5260s, hitting the level three times over seven sessions, including the March 28th all-time high of 5265 (Chart 1). Bears took control right from the beginning this month. The index suffered three weekly declines before recovering. This week, with a session to go, the S&P 500 is up 1.6 percent.
The recent selloff has impacted bullish sentiment.
In the week to Tuesday, Investors Intelligence bulls tumbled 10.3 percentage points week-over-week to 46.2 percent. In the week to Wednesday, the NAAIM Exposure Index dropped 3.5 points w/w to 59.5, while American Association of Individual Investors bulls in the week to Thursday declined 6.2 percentage points w/w to 32.1 percent. The three surveys respectively measure sentiment among newsletter writers, money managers, and retail investors. This week’s readings represent a decent drop from the recent highs.
Investors Intelligence bulls hit 62.5 percent in the week to April 2nd. This was the highest reading since April 2021 and the fourth consecutive weekly reading of 60-plus. The NAAIM Exposure Index printed 103.9 in the week to March 27th; two weeks before that, it hit 104.8, which was the highest since November 2021. And AAII bulls hit 50 percent in the week to March 28th; three weeks prior, bulls reached 51.7 percent, which was an 11-week high.
Chart 2 combines the three surveys and takes out an average. A reading of 71.5 in the last week of March was the highest since January 2021. This week, the average dropped to 45.9, which is low but not low enough to even match last October’s low, when it dropped to 32.1, let alone the late-September 2022 trough of 19.3. Equities reached a major low in October 2022.
The bottom line is that investor sentiment has taken a hit but not enough to signal a durable bottom in equities.
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The 10 Top/Bottom S&P 500 Index percent net change performers
By: Thom Hartle | April 26, 2024
• Today (8:33 CST), the 10 top/bottom percent net change performers in the S&P 500 Index.
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The 10 Top/Bottom NASDAQ 100 Index percent net change performers
By: Thom Hartle | April 26, 2024
• Today (8:33 CST), the 10 top/bottom percent net change performers in the NASDAQ 100 Index.
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Bullish sentiment has experienced a significant reversal. Historically, elevated levels of optimism among retail investors and low volatility in financial markets have frequently indicated short-term market peaks
By: Isabelnet | April 26, 2024
• S&P 500
Bullish sentiment has experienced a significant reversal. Historically, elevated levels of optimism among retail investors and low volatility in financial markets have frequently indicated short-term market peaks.
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S&P 500: The degree of activity in leveraged long vs short US equity ETFs has experienced a substantial decline as sentiment shifts
By: Isabelnet | April 26, 2024
• S&P 500
The degree of activity in leveraged long vs short US equity ETFs has experienced a substantial decline as sentiment shifts.
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With a median short interest level of 1.8%, which remains relatively low, market participants are positive or cautiously optimistic about the future performance of the S&P 500
By: Isabelnet | April 25, 2024
• S&P 500
With a median short interest level of 1.8%, which remains relatively low, market participants are positive or cautiously optimistic about the future performance of the S&P 500.
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S&P 500: Active investment managers frequently face criticism for their consistent pattern of selling equities at market bottoms and buying them at market tops
By: Isabelnet | April 25, 2024
• S&P 500
Active investment managers frequently face criticism for their consistent pattern of selling equities at market bottoms and buying them at market tops.
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Money managers Reduced their exposure to the US Equity markets since last week...
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NAAIM Exposure Index
April 25, 2024
The NAAIM Number
59.48
Last Quarter Average
87.84
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The AAII Investor Sentiment
By: AAII | April 25, 2024
Bullish 32.1%
Neutral 33.9%
Bearish 33.9%
• Historical 1-Year High
Bullish: 52.9%
Neutral: 37.4%
Bearish: 50.3%
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