coolhand's Account Talk

[coolhand]

Friday's weak action bled over into Monday and sure enough we got the volatility the indicators suggested we'd get.




Price on the S&P 500 has not retested its low and to this point the 200 dma has not been violated. The same cannot be said of the 50 dma, but that's where the battle appears to be. Price on the DWCPF is testing its 200 dma. It's a compressed area between the 50 and 200 dma's on that chart. Looking at the past several months, we can see price has traded in a range during that time. But it did hit a fresh high just a couple of weeks ago. Was that the top? NAAIM still shows a good number of bulls, though as a group they are more neutral as of last week. That suggests there is at least some trepidation about the short term. The longer term has been bullish and that has not changed.

Breadth has flipped negative again. The options are neutral. I think we have more of the same on tap. It could be a battle this week.

 

[coolhand]

After being pounded lower the past couple of trading days, the bulls countered with a decent bounce.




The bounce pushed price back towards the 50 dma on the DWCPF as well as the S&P 500. That's obviously an area of resistance at the moment.

My intermediate term system remains bearish, while cumulative breadth went positive again. While positive is at least somewhat bullish, breadth is really bouncing above and below the neutral line right now. TRIN and TRINQ are both leaning bearish this evening.

However, the OEX is bullish, while the CBOE is neutral.

It remains a mixed bag as the tug-of-war continues..

 

[coolhand]

The back and forth battle between the bulls and bears continued today as the bears countered yesterday's rally with a push to the downside once more.




But price didn't test Monday's low, which is a plus of sorts. On the other hand, the 50 dma continues to act as resistance. We should also remember that the 200 dma has held on the DWCPF.

This evening, the OEX is bearish, while the CBOE is bullish. That combination tends to favor the smart money (OEX), so the bears may not be done. We'll have to see.

Breadth remains positive, but sideways. My intermediate term system remains negative. TRIN and TRINQ are neutral.

Overall, the indicators are still mixed, but do I favor more selling on Thursday. It doesn't have to be a lot if we get it. NAAIM reports in the morning.

 

[coolhand]

As expected, the bears continued to push price lower. In fact, they hammered the bulls pretty good and did some technical damage as well.




We can see that the DWCPF is leading the S&P 500 lower. On that chart, price closed well below the 200 dma. The S&P 500 is faring better, but price still remains below the 50 dma, so it's hard to get overly optimistic.

This evening, the OEX is back to neutral, while the CBOE is bullish. NAAIM came in more neutral as the bears continue to reign in their shorts and the bulls aren't heavily bullish. Again, it's a neutral picture for this smart money. The fact that bears are not falling over themselves to short the market tells me it's not likely going to fall apart, though we could still see more selling.

For now, the bears appear to have the upper hand, but I don't think they'll get a ton of downside traction based on the NAAIM reading.

 

[coolhand]

The TSP stock funds had a down week last week. Friday's action did close on a positive note, but the charts remain somewhat dicey.




We can see that price remains below some key areas. In particular, price has been below the 50 dma on both charts for about 2 weeks now. Price has now been below the 200 dma on the DWCPF for a couple of trading days.

I pointed out that NAAIM is now neutral. I said in my last post that the market is not likely to fall apart with this reading, but I am now going to open the door to the possibility that the market may be slowly approaching a bigger sell-off. It has been a bull market for a long time, so it is very easy to favor the longer term trend. Yes, that's been the path of success for those that have largely held long, but let's now entertain the possibility that the weakness the market has endured the past few weeks may be an early warning. We'll step through this possibility day by day as the indicators play out.

So, NAAIM is neutral. TSP Talk is neutral this week. The OEX is neutral to modestly bearish. The CBOE is bullish. Sentiment is neutral overall.

Cumulative breadth is straddling the neutral line. TRINQ is bullish for Monday, but TRIN is neutral. My intermediate term system remains negative with no hint of turning back up as yet.

We are in uncertain territory with respect to market direction. I am going to suggest to follow NAAIM and have some dry powder on hand, but not necessarily move to all cash, though that is really up to your particular risk tolerance and personal perspective. I am not calling for a big decline, I am only suggesting at this point that one may be coming. It is also possible that we get yet another rally when the market finally breaks out of its sideways pattern (since late February for the DWCPF; the S&P 500 still has slight discernable upward tack).

The indicators will eventually tell us one way or the other. I am neutral for the new week.

 

[coolhand]

After having a down week last week, the market started off the new week with even more selling.




It didn't start out that way in the morning session, but the early rally faded to the neutral area for a while before succumbing to even more selling pressure in the mid-afternoon. Price closed near its lows of the day. The S&P 500 inched closer to its 200 dma, while the DWCPF, which had relative strength to the S&P 500, fell to its lows from last Thursday (still under the 200 dma). The charts are still not ugly, but there was some volume behind today's action.

Cumulative breadth is negative and at the lower end of its trading range currently. Sentiment shows the OEX leaning bullish for Wednesday, while the CBOE is neutral.

The market is due a bounce at the very least and the OEX suggests we may get one.

 

[coolhand]

While the market was underwater the entire trading session today, there was some rallies mixed in with the selling. Unfortunately for the bulls, it wasn't enough to price back over the neutral line.




So, the charts aren't looking any better. The 200 dma is now getting tested on the S&P 500. It held today, but we obviously may get a retest. Price remains on the 200 dma on the DWCPF.

This evening, the options are looking on the neutral side. TRINQ closed at a low level, which is normally bearish. Cumulative breadth is at a 2-month low an in danger of going lower.

This selling seems controlled to some extent, though it could certainly get worse before it gets better. The indicators suggest more selling, but we are due a bounce. The 200 dma may get taken out on the S&P 500 (head fake), so we'll have to be on the look out for that. It may be used to suck in more bulls before a move back up.

Having said that, something may have changed too. Be open to the possibility of a more serious decline as things play out. My intermediate term system is NOT hinting at turning up yet.

NAAIM reports in the morning. Remember, they got somewhat defensive last week. They saw risk rising.

 

[coolhand]

The market is seeing some volatility right now. Today's action was more or less a draw between the bulls and the bears and they fought over price direction.




Not a lot of change in the charts, though it's notable that the 200 dma continues to hold on the S&P 500.

Breadth remains negative and was flat today. My intermediate term system remains solidly negative (bearish).

Sentiment shows that the OEX and CBOE are bearish for Friday. Perhaps the biggest news is that NAAIM got more defensive, but they still have their bulls holding to their longs. I note that the bears in that survey have increased their shorts. This indicates to me that the bears are likely not done and lower prices are coming over the days ahead. It is not clear to me how much damage we might see, but I am still not expecting the sky to fall (at least not yet).

I started out the week neutral, but I am shifting to a more bearish stance for the next few days.

 

[coolhand]

In my last post, I said the options were bearish and that NAAIM was indicating the likelihood of more selling. That was for Friday's action, which saw more decline in price. In fact, price broke through and closed below the 200 dma on the S&P 500.




Looking at the charts, I see possible horizontal support for the S&P around the 2725 area. The problem is, the DWCPF has already broken its horizontal support, so that doesn't bode well for support holding on the S&P, but we'll have to see. Both charts are essentially oversold.

My intermediate term system continues to look bearish. Cumulative breadth is bearish. The A/D Line on the NYSE is ugly.

Sentiment shows the OEX neutral and the CBOE bullish (for Monday). NAAIM is leaning bearish, but not heavily. TSP Talk is neutral.

For what it's worth, gold had a nice up-day on Friday. Bitcoin (and crypto in general) have been doing well for weeks. Bonds are signaling trouble. Are these collective indicators a sign of potential trouble for the stock market? That would be my interpretation, but only that it's possible and not a given.

I remain bearish for now. Try not to get too complacent. The market may be in more trouble than we think. That doesn't mean sell everything, but as I said a few posts ago, NAAIM was getting defensive and I suggested following their lead. Hopefully, you have some dry powder on hand should the market find a bottom.

 

[coolhand]

The bulls and bears battled once again to start the new week.




We can see that the DWCPF was largely unchanged, but the S&P 500 edged lower. Volume remains elevated.

This evening, the OEX is leaning bullish. The CBOE is neutral. TRIN is bearish and breadth edged up, but remains negative. My intermediate term system continues to look bearish with no hint of turning.

The market remains in trouble unless the bulls can regain control. The OEX is bullish, but other indicators suggest any rally may not hold or go deep. I remain bearish.

 

[coolhand]

Once again, the market gets the masses leaning one way (the bears this time) and turns price on a dime.




It was a big move too. The kind that usually signals a bottom is in. There was volume behind the move and price certainly retraced a good chunk of recent losses. Is it out of the woods? It might be, but the charts still show key resistance levels that have not yet been tested, though the S&P took out its 200 dma today.

The OEX was bullish for Tuesday's action and it remains that way heading into Wednesday. The CBOE is neutral. Cumulative breadth turned back up hard and actually flipped positive. That kind of move bodes well for the bulls. My intermediate term system is now showing hints that the market may have turned the corner, but it still remains negative (it's not a fast moving system). TRIN and TRINQ closed at very low levels and that's bearish for Tuesday, but given the market may have turned, even if we see some give-back it may not be much.

I think today's action certainly supports looking for a spot to get reinvested, but it's only one day and while it was a big one that appears bullish, there's always the chance that the lows get retested.

 

[1965Vintage]

Once again, the market gets the masses leaning one way (the bears this time) and turns price on a dime.

View attachment 44460
View attachment 44461

It was a big move too. The kind that usually signals a bottom is in. There was volume behind the move and price certainly retraced a good chunk of recent losses. Is it out of the woods? It might be, but the charts still show key resistance levels that have not yet been tested, though the S&P took out its 200 dma today.

The OEX was bullish for Tuesday's action and it remains that way heading into Wednesday. The CBOE is neutral. Cumulative breadth turned back up hard and actually flipped positive. That kind of move bodes well for the bulls. My intermediate term system is now showing hints that the market may have turned the corner, but it still remains negative (it's not a fast moving system). TRIN and TRINQ closed at very low levels and that's bearish for Tuesday, but given the market may have turned, even if we see some give-back it may not be much.

I think today's action certainly supports looking for a spot to get reinvested, but it's only one day and while it was a big one that appears bullish, there's always the chance that the lows get retested.

I can't remember a harder market to time.


Sent from my moto z3 using TSP Talk Forums mobile app

 

[coolhand]

The market added to its gains on Wednesday, which wasn't a surprise given the magnitude of the move in the previous session.




Both charts now show price above the 200 dma, but still below the 50 dma. Momentum is rising.

Breadth didn't change much, but it does remain positive. TRIN and TRINQ are bearish for Thursday. The OEX is bearish as is the CBOE. Futures are negative.

The indicators show that the market is likely to give back some gains on Thursday.

NAAIM reports in the morning.

 

[coolhand]

The S&P 500 continued to ascent today, but the DWCPF is lucky to just hold above its 200 dma. Interesting.




We can see that price on the S&P is beginning to approach resistance at the 50 dma. It's looking good even as the DWCPF is just treading water.

The options are looking on the neutral side this evening. What I found telling is that NAAIM didn't get bulled up on the rally. They are holding neutral. That's reason to temper upside expectations. That doesn't mean the market can't continue to bias higher, but if the smart money isn't falling over itself getting long, there must be a reason. Breadth remains positive.

If NAAIM had shifted more bullish, I would have been more comfortable being a bull, but since they didn't, I'm neutral.

 

[coolhand]

I've been away from my computer for a few days and not able to post. Let's get to it.




The rally has continued despite any bearish indicators. It's really not a surprise under the circumstance. Price on the S&P 500 is now over its 50 dma. Price on the DWCPF is in the process of challenging its 50 dma.

This evening, the OEX is leaning a bit bearish as is the CBOE. Breadth looks good and remains bullish. My intermediate term system flipped positive today and will likely hold that position for a while.

Given the "V" bottom, price may very well eventually challenge the previous highs. Obviously, it will take some time yet. My intermediate term system supports that expectation. None of this is a given, but the odds favor that outcome. I am now bullish from my previous neutral stance.

 

[coolhand]

A positive start to the trading session gave way to selling today, but the bears weren't able to push price too deep.




Price was almost unchanged on the S&P 500, which kept it above the 50 dma. The DWCPF tried to push through its 50 dma, but was turned back and closed lower on the day.

This evening, the options are leaning bearish. Breadth is still positive.

I suspect the 50 dma may be a battle ground in the short term. We'll have to see how persistent the bears will be and whether the bulls can continue to counter their efforts to take control of price. The bulls still have the momentum for now.

 

[coolhand]

The battle continued today with price giving up some ground, but no serious technical damage has been done to this point.




Price tested the 50 dma on the S&P, but it held (support). The DWCPF remains under its 50 dma, but well above its 200 dma.

The OEX remains bearish. The CBOE has gone neutral.

So far, we may simply have a bull flag being formed. Considering how quickly the market took back losses during the previous rally, a short-term pullback is certainly within reason. NAAIM reports in the morning.

 

[coolhand]

Another battle at the 50 dma today.




Price remains above the 50 dma on the S&P and below it on the DWCPF. The bulls managed to keep it positive at the close.

The OEX remains bearish once again, while the CBOE flipped bullish. NAAIM saw a decent increase in bulls and drop in bears. They aren't quite a bullish as they once were, but they do seem to be saying that risk is more in the bull's favor, which is where I have largely seen the market over the past few days.

I suspect that sooner or later price will pop higher. I remain bullish.

 

[coolhand]

For the week last week, the bulls managed to push price a bit higher (C and S funds), but the bears have not rolled over.




We can see that the battle is still being waged in the area of the 50 dma on both charts, but the bulls have successfully kept price above that key average for a week now. Unfortunately, the DWCPF has remained under that average.

My intermediate term system is showing signs of weakness in some areas, but remains positive. Cumulative breadth continues to look pretty good despite the battle that has been playing out. The A-D Line also looks good.

Sentiment shows that the OEX remains bearish, while the CBOE is neutral. TSP Talk saw a drop in the number of bulls and is neutral. NAAIM got a bit more bullish and the bears in that survey reduced their exposure to the downside. It's not a consistent picture, but I defer to NAAIM, which means sentiment is leaning bullish.

Looking at the my indicators, the bears are probably not going to have an easy time of it. In fact, they are likely to lose the intermediate term battle. Having said that, precious metal and crypto are trying to break out and that could have implications (I think negative) for the stock market should they continue to move higher. But that's another battleground between the same 2 opposing forces. Things are getting more interesting every week. I remain bullish for now.

 

[coolhand]

Not a whole lot changed as we started the new week.




Price on the DWCPF did manage to test the 50 dma. Resistance held, but the index did hold on to a good portion of its gains.

This evening, the OEX is quite bearish, while the CBOE is neutral. My other indicators are much as they were in the previous post.

The OEX suggests some selling on Tuesday, but I don't know that we can expect a lot of downside out of it with breadth continuing to look bullish.