Once again last week, prices on the stock market hit all time highs on several indexes. I keep looking for a sign or signal that prices are going to slow down, rollover, or consolidate. The International index appears to be just beginning it’s uptrend and in my opinion is way behind the S&P and Small Cap. Bonds on the other hand is another story. So let’s begin with Bonds.
Bonds just fired a buy signal last week and this week the opposite just happened. Wednesday price fell below the 50 day moving average again. Thursday price fell below the sell CBL to fire a sell signal. Friday price did not recover back above the CBL, so a sell signal was confirmed. The DMI turned negative and is just a mixed bag at the moment. I still feel Bonds have reached a bottom, but how long it is before a true uptrend begins is just a guess. The weekly and monthly are showing no signs of life.
The S&P 500 is still just a thing of beauty. The uptrend is firmly intact. The 50 day moving average is rising. Volatility is low. The DMI is positive, but is beginning to show a few signs of slowing. It would not surprise me at all to see the S&P slow and cosolidate sideways for awhile. Sideways moves can sometimes be as long as 10-15 trading days or 2 to 3 weeks. Nothing to do here but watch and ride.
The Small Cap also hit all time highs last week, but the overall look is that we are beginning to consolidate. This doesn’t mean prices are going to collapse or begin a new downtrend, but it is a time where price just slides sideways for awhile. Looking back, it appears to have begun about 9 trading days ago. The 50 day ma is catching up to price and price is tight on the CBL. All of these are signs that a little profit taking is happening and hopefully a snap higher is within 5-10 trading days. Nothing to do but watch and ride.
The International index has the best looking short term uptrend profile. Price has been in a steady climb and holding trend since November 7th, 2015. The upside here just seems greater if you compare it to the run of the S&P and Small Cap. Volatility and DMI look good, so there is nothing to do here but watch and ride.
Conclusion: I will continue to ride the C, S, and I and stay out of Bonds. The daily charts are just now beginning to show some signs of slowing with the C and S, but no guarantee that is true. The International still looks the best for short term. Bonds, are sliding sideways but appear to have found theri base.
No comments:
Post a Comment