coolhand's Account Talk

[coolhand]

NAAIM came in slightly more bearish today. The reading showed that the bears increased the leverage on their short positions, while the bulls held firm. This reading is bearish, but not wildly so. I anticipate more weakness, but I also expect the bulls to counter attempts to bring the market down. In other words, volatility should be expected.

 

[tsptalk]

AAII for 9/23:

25% bullish
46% bearish

 

[nnuut]

Check out https://finviz.com/

Interesting!!

 

[coolhand]

We had a bit of a roller coaster ride today with the averages closing mixed by the close.




The bulls were not able to recoup much, if any, losses today. We can see that the DWCPF dipped for a modest loss.



Breadth was a bit weak and remains bearish.

NAAIM came in a bit more bearish today and I see the reading as bearish overall, but not by a lot. I see the reading as a prescription for more volatility for now, but with a downside bias (for now).

I remain bearish, but not overly so. I believe the bulls will put up a fight and will likely win the war, but whether a bottom is in is debatable. Watch the 200 dma.

 

[coolhand]

The bulls took back a chunk of recent losses today. It was a decisive reversal, but does not yet change the intermediate term trend, which is down.




Price remains below the 50 dma on both charts, which is now an area of resistance. We'll have to see if the bulls can test this average and whether they can successfully retake it.



Breadth turned back up, but remains negative (bearish).

I said that the NAAIM reading, which was modestly bearish, suggested volatility. Volatility can occur during a trading day or can manifest for days to weeks as the bulls and bears battle for control of price. For the moment, the bulls have yet to prove they have recaptured control of price. A successful retest (positive breakout) of the 50 dma would help in this regard, but that remains to be seen.

I remain modestly bearish for now.

 

[coolhand]

The bulls had their way with the market today, tacking on significant gains that has price now testing the 50 dma.




We can see that price closed right on the 50 dma on the S&P 500 and just above it on the DWCPF. What we need to see is a continued push past that average (not necessarily in the short term) to help firm it up as support. Note that resistance at the 3500 area of the S&P (February peak) is not far above right now. Momentum is starting to turn back up.



Breadth also rose and is now neutral. Note that the 21 day ema is starting to negatively cross the 39 day ema. That would be bearish if it continues to move in that direction (if the bulls keep pushing price higher, that should not be a problem).

So, the bulls wasted no time testing the 50 dma. Now, I have to see whether or not they can successfully push it higher and hold it.

I am moving to a neutral sentiment.

 

[DreamboatAnnie]

Thank you for your pointing out the negative crossover! This info seems very noteworthy. Could this mean smart money is moving out of the market even as it rallies?? Seems like divergence. Is that an accurate take??? :thinking:

 

[coolhand]

Thank you for your pointing out the negative crossover! This info seems very noteworthy. Could this mean smart money is moving out of the market even as it rallies?? Seems like divergence. Is that an accurate take??? :thinking:

When breadth is moving lower, it means more stocks are falling than rising and vice versa (on the NYSE in this case). Generally, breadth rises on rallies and falls on sell-offs. Right now, it's rising. If it keeps rising, the 21 day ema will start turning up again.

I don't want to use the term smart money (or dumb money) when sell-offs (or rallies) are in progress, because I don't see it that way. The amount of fiat in the market is not owned by smart or dumb money, but by the banks and their cronies (around the world). We're talking about hundreds of trillions sloshing around the planet. The elite own more than 90% of that money. That may not be just U.S. dollars, but U.S. dollars very likely make up the bulk of it.

Are the bankers smart money? They own the casino. I have never taken the term smart money to mean bankers, but they may be tethered on some level to the large money movers (hedge funds, etc.).

 

[coolhand]

Price got rejected at resistance today on the S&P 500, but found support on the DWCPF.




I won't make too much of it because price didn't move all that much. A retest should be expected.



Breadth dipped back under the shown averages and is now technically bearish.

The battle continues. I remain neutral.

 

[nasa1974]

I guess we don't go positive for the month. Unless your in the "F" Fund.

 

[coolhand]

We got another test at resistance (50 dma) today.




Early on in the trading day it appeared the bulls might have a great day and successful test. Instead, they had an okay day and a tentatively successful test as the bears managed to push price back down in afternoon trade. Price closed above the 50 dma on both charts. The problem is it did so only marginally. This is not a convincing test and only shows that the 50 dma is a battleground area. It could go either way right now. Volume was low on the last day of the quarter.



Breadth rose and is neutral once more.

I don't have any insight on where this market goes in the short term. It seems to be in neutral right now. We get a fresh NAAIM reading tomorrow. Maybe that reading will give us a better idea.

 

[coolhand]

The latest NAAIM reading changed only modestly. The bears have reduced their short leverage, which appears to be the reason for the modest change in reading. Overall, the reading does remain bearish, but only modestly so. I would say that this reading suggests more back and forth battle over price, but no clear expectation of a breakout or breakdown.

 

[coolhand]

The bulls made a move today to push price past resistance at the 50 dma.




The DWCPF is leading the SPX in this regard and it's a bullish move.



Breadth rose and flipped positive.

NAAIM was relatively unchanged and does remain modestly bearish.

I was neutral heading into today and I'm going to maintain that neutral stance for now, but I'm encouraged by today's action.

 

[coolhand]

The bulls lost some ground on Friday, but they did close out the week with gains on C and S funds.




Price closed back under the 50 dma on the S&P 500, but remained above that average on the DWCPF. This remains the battleground area for the time being.



Breadth is positive and actually advanced on Friday. This is a good sign for the bulls even as the S&P struggles a bit.

So, the charts are looking okay for the most part, but obviously the market is not out of the woods. NAAIM was modestly bearish late last week and until they start getting more bullish I think the market may continue to struggle. TSP Talk came in bullish. More so than I would have expected.

Overall, the bulls are doing a good job of holding off the bears and have even been making headway in turning price back up. But as I said, the market is still not out of the woods.

I remain neutral, but encouraged.

 

[coolhand]

The bulls started out the week with a big rally. The action was decisively bullish.




Price on the S&P 500 closed above the 50 dma once again, but what is more bullish is price on the DWCPF, which soared and is not far from testing its all-time high. Also, price has been above the 50 dma for several trading days, which is bullish.



Breadth, which was already bullish, shot higher and is looking very bullish.

It's beginning to look obvious that this market may be stronger than it has appeared. Even the smart money has been caught (to some extent) on the wrong side of the market.

I myself have been neutral of late, but have also acknowledged that there were bullish signs. I am now moving to a modestly bullish stance. I want to see the S&P 500 hold price above the 50 dma and I'd like to see price push past the previous high on the DWCPF. If today's rally was more than just a 1-day pop, this could be a big week for the bulls. We'll see how it goes.

 

[PessOptimist]

Yes, but, gaps, gaps?

PO

 

[coolhand]

Yes, but, gaps, gaps?

PO

I leave the deeper technical dives to the others on the board. I try to keep things in more general terms.

 

[PessOptimist]

OK coolhand. I do enjoy and value your posts.

 

[coolhand]

After daring to feel bullish yesterday the market reminded me that it's not one-sided (I already knew that).




Once again, it's the S&P 500 that is struggling the most as price closed just under the 50 dma once again. But price on the DWCPF held up much better and that index continues to lead of late. It's hard to get bearish on the action as a total given the disparity.



Breadth dipped, but remains solidly bullish.

This is an interesting market right now where small caps are leading large caps despite the economic risks (perceived or real).

I am going to remain modestly bullish taking my cues from the DWCPF for now.

 

[nasa1974]

The market is back up this morning. Let's hope we don't get a late afternoon tweet to make it tank like yesterday.