It's a Buy

It took the Seven Sentinels quite a bit of time to flip back to a buy, but that's how much the market was on the ropes when it tagged SPX 1040 for the third time a mere 8 trading days ago. Since the 1st of September there's only been one red close and the S&P has advanced about 7.8% in that time.

But significant resistance looms around 1130 for the S&P. I suspect we'll surpass and close above that level to convince as many as possible that the rally is for real and to get as many bears to capitulate as possible before the market turns again.

Here's the charts:



NYMO has posted a new 28 day trading high today, which along with buys from the other seven signals, means the system is back on a buy.



Healthy advances are seen in the A/D line in these charts.



TRIN and TRINQ are on buys, but we have low readings after a big run-up.



BPCOMPQ continues to ebb higher and remains on a buy.

The second chart here is showing NYMO hitting the 28 day trading high.

So as I said previously, the system now has all seven signals on buys with NYMO posting a new 28 day trading high, which flips the system to buy status.

I am fairly confident we'll run higher yet, but we've covered a lot of ground in a short period of time and momentum is getting lofty looking at the NAMO and NYMO charts. We can consolidate and grind higher yet though. The only thing I'd caution here is that when the market turns again I doubt I can get a sell signal fast enough to hold gains. That's been a problem in this market environment and something to consider if you're in stocks. As more mechanical systems flip to buys and the bears capitulate, downside risk will rise.

 

[WorkFE]

Maybe we run up a bit more to gather in some bears maybe we don't. We could toil around at these levels for a few weeks. Then it's midterm runup time and who knows what affect that will have.

 

[coolhand]

Maybe we run up a bit more to gather in some bears maybe we don't. We could toil around at these levels for a few weeks. Then it's midterm runup time and who knows what affect that will have.

I agree. There's no shortage of scenarios with the elections looming. It's certainly a continued prescription for volatility.

 

[WorkFE]

Keep at least one eye on the ball. Two if you're not operating heavy equipment.

 

[grandma]

Coolhand: thanx for making the `explanation' info a permanent feature of your write-ups.
I've been away from 'talk for awhile, and had forgotten how to at least partially decipher what the different `wiggledys, squerls & waves' meant.... :embarrest:

 

[coolhand]

Coolhand: thanx for making the `explanation' info a permanent feature of your write-ups.
I've been away from 'talk for awhile, and had forgotten how to at least partially decipher what the different `wiggledys, squerls & waves' meant.... :embarrest:

Hi grandma. Happy to see you back on the MB. I'm doing my best to inform folks how to use the SS. Glad it helps in understanding all those squiggles.

 

[airlift]

CH,
Today NYMO is at 61.65. Please correct me, perhaps I am spitting hairs trying to avoid whiplash. The corrected chart you posted the other day showed the NYMO 28 day trading high would be 63 or 66 (I could not locate it today). Today the Futures are negative. Is this toppy? Tia.

 

[coolhand]

CH,
Today NYMO is at 61.65. Please correct me, perhaps I am spitting hairs trying to avoid whiplash. The corrected chart you posted the other day showed the NYMO 28 day trading high would be 63 or 66 (I could not locate it today). Today the Futures are negative. Is this toppy? Tia.

Each trading day moves the 28 day trading high one step to the right, so the trading high is not a set number. Yesterday we closed about 3 points above it.

Toppy? IMO, yes. We could drive higher yet, but it's anyone's guess how much farther it could go. I'm sitting tight in cash myself, although I'm tempted to move something into the F fund.