Sunday, August 28 2022, 2015ET
Market Timing Charts, Analysis & Commentary for Issue #364
Timer Charts of S&P-500 Cash Index (SPX) + NASDAQ-100 Cash Index (NDX)
Most recent S&P-500 Cash Index (SPX) Close: 4,058 down 170 (down -4%) for the week ending on Friday, August 26, 2022, which closed near its -2 sigma.
DJIA ALL TIME INTRADAY HIGH = 36,953 reached on Wednesday, January 5, 2022
DJT ALL TIME INTRADAY HIGH = 18,247 reached on Tuesday, November 2, 2021
SPX ALL TIME INTRADAY HIGH = 4,819 reached on Wednesday, January 4 2022
NDX ALL TIME INTRADAY HIGH = 16,764 reached on Monday, November 22, 2021
RUT ALL TIME INTRADAY HIGH = 2,459 reached on Monday, November 8, 2021
Current DAILY +2 Sigma SPX = 4,327 with WEEKLY +2 Sigma = 4,400
Current DAILY 0 Sigma SPX = 4,184 with WEEKLY 0 Sigma = 4,050
Current DAILY -2 Sigma SPX = 4,040 with WEEKLY -2 Sigma = 3,699
NYSE McClellan Oscillator = -148 (-150 is start of the O/S area; around -275 to -300 area or lower, we go into the "launch-pad" mode; over +150, we are in O/B area)
NYSE Breadth Thrust = 39.5 (40 is considered as oversold and 65 as overbought)
DeTrenders Charts for SPX, NDX, TRAN & RUT Indices
200-Day MA DJ TRAN = 15,031 or 4.3% ABOVE DJ TRAN (max observed in last 7 yrs = 20.2%, min = -20.3%)
200-Day MA RUT = 1,992 or 4.7% ABOVE RUT (max observed in last 7 yrs = 21.3%, min = -22.6%)
50-Day MA SPX = 3,996 or 1.5% BELOW SPX (max observed in last 7 yrs = +8.6%, min = -9.3%)
200-Day MA SPX = 4,307 or 5.8% ABOVE SPX (max observed in last 7 yrs = 15.2%, min = -14%)
DJ Transportation Index (proxy for economic conditions 6 to 9 months hence) has had a pretty tough time trying to close above its 200 day MA. 14,000 is a key area that needs to be tested before we go back up.
Russell 2000 Small Caps Index (proxy for Risk ON/OFF) has been very weak and been leading NDX lower. RISK is OFF here.
FOUR of our EIGHT DeTrenders are in the NEGATIVE territory. The DeTrenders for DJ Tran & RUT will continue to be harbingers of future price behavior in our broad indices.
WEEKLY Timing Model = on a SELL Signal since Friday, February 18, 2020 CLOSE at 4349
DAILY Timing Model = on a SELL Signal since Tuesday, August 23, 2022 CLOSE at 4,128
Max SPX 52wk-highs reading last week = 5 (over 120-140, the local maxima is in)
Max SPX 52wk-Lows reading last week = 15 (over 40-60, the local minima is in)
HA_SP1 closed near its zero sigma channels
HA_Momo = -4.4 (reversals most likely occur above +10 or below -10)
Vol of the Vols Chart
Spot VIX stood at 25.6 Friday night, a tad below its +2.5 sigma (remember it's the VIX volatility pattern aka "its sigma channels" that matters, and not the level of VIX itself (this is per Dr. Robert Whaley, a great mentor and inventor of original VIX, now called VXO). VIX usually peaks around a test of its +4 sigma).
Last week VIX started its ascent from its zero sigma (about 21.5) and then eased off into Thursday till our venerable Fed Chair Jerry Powell spooked the market on Friday morning from Jackson Hole, WY. IMHO, we are NOT done yet in this shockwave but who knows. Stay alert.
Components of SPX above their respective 200-day MA Chart
This scoring indicator closed at 34.6% following a sharp drop on Friday from a drip drip pull back from 50% area. No signal here. But we are now looking for a retest of its lows near 15% to 20%.
SPX SKEW (Downside Tail Risk) Chart
This week SPX SKEW (Downside Tail Risk) has been dropping since April 4th (from its +2 sigma) and closed today at 124, now about its zero sigma (normal = 115, range 100-150).
All quiet on the Eastern & Mid-Western Fronts? the venerable Admiral Tiko, KCPE, remains cautiously bearish here into Yom Kippur (Oct 4th).....
How to interpret the value of SPX SKEW? (from CBOE white paper on SKEW)
3-month VIX Futures Spread(VX) Chart
This popular timing indicator for identifying tradable bottoms, (now long MAY22 and short AUG22 VIX Futures) dropped to -1.42 at the Close. This says we could be near a [dead-cat?] bounce in the next 3 days.
HA_SP2 = 27.1 (Buy signal <= 30, Sell Signal >= 70)
This indicator, could be setting up for a retest of 20-25 area.
US Treasury T-Notes & T-Bonds Yields Chart
US Treasuries had a mixed YTMs this past week. Stay tuned. Drink more Persian Tea. Read more Rumi. Bond Vigilantes are NOT done yet, IOHO !!