Saturday, April 2, 2016 1530ET
Market Timing Charts, Analysis & Commentary for Issue #137
Timer Charts of S&P-500 Cash Index (SPX) + NASDAQ-100 Cash Index (NDX)
Most recent S&P-500 Cash Index (SPX): 2072.78 up +36.84 (up +1.8%) for the week ending on Friday, April 1st, 2016, which closed about near its +2 sigma.
SPX ALL TIME INTRADAY HIGH = 2134.72 (reached on Wednesday, May 20th, 2015)
SPX ALL TIME CLOSING HIGH = 2130.82 (reached on Thursday, May 21st, 2015)
Current DAILY +2 Sigma SPX = 2083 with WEEKLY +2 Sigma = 2142
Current DAILY 0 Sigma (20 day MA) SPX = 2030 with WEEKLY 0 Sigma = 1992
Current DAILY -2 Sigma SPX = 1977 with WEEKLY -2 Sigma = 1841
NYSE McClellan Oscillator = +33 (-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 = 53.84 (40 is considered as oversold and 65 as overbought)
On Friday, after the release of March NFP, SPX put in another "hammer" candlestick bar during RTH. This is a very bullish configuration. Our SPX target for month of April is 2120-2140.
Canaries [in the Coal Mine] Chart for DJ TRAN & RUT Indices
200-Day MA DJ TRAN = 7818 or 0.9% below DJ TRAN (max observed in last 5 yrs = 20.2%, min = -20.3%)
200-Day MA RUT = 1140 or 2.0% above RUT (max observed in last 5 yrs = 21.3%, min = -22.6%)
DJ Transports (proxy for economic conditions 6 to 9 months hence) has been retesting its 200 day MA since March 24 while the said MA has sported a slight negative slope. This is not necessarily a good news and we must keep on eye on this.
Must recall that Transports peaked in Nov '14 and then led the SPX down in 2015 and now they are leading SPX higher after bottoming in Jan 20, 2016. A burst up in DJ Transports, before violating its 200 day MA, is what is needed here to solidify our bullish bias.
Russell 2000 Small Caps (proxy for RISK ON/OFF) is now 7.3% above its 50day MA & RISK continues to crawl back in. This past week, RUT has begun a steep channel breakout, after spending most month of March in sideways action.
DeTrenders Charts for SPX, NDX, TRAN & RUT Indices
50-Day MA SPX =1941 or +5.8% below SPX (max observed in last 5 yrs = +8.6%, min = -9.3% )
200-Day MA SPX = 2017 or +2.8% below SPX (max observed in last 5 yrs = 15.2%, min = -14%)
Only ONE of our Eight DeTrenders are negative now (RUT 200DTs).
WEEKLY Timing Model = on a SELL Signal since Friday 1/29/16 CLOSE
DAILY Timing Model = on a BUY Signal since Thursday 2/18/16 CLOSE
Max SPX 52wk-highs reading last week = 68 (over 120-140, the local maxima is in)
Max SPX 52wk-Lows reading last week = 1 (over 40-60, the local minima is in)
HA_SP1 = nearing its +2 Sigma now
HA_Momo = +2.7 (reversals most likely occur above +10 or below -10)
NOTE: we continue to pay attention to the divergences developing between our HA_momo and HA_SP1.
Vol of the Vols Chart
VIX = 13.1 which is at its -1.5 sigma (remember it’s the VIX’s vol pattern (its sigma channels) that matters, and not the level of VIX itself (this is per Dr. Robert Whaley, a great mentor and the inventor of original VIX, now called VXO. VIX usually peaks around a test of its +4 sigma).
Funeral Services for the JAN-FEB VIX shockwave will be held shortly. Da Bulls will be serving Cristal Champagne.
5-day TRIN & TRINQ Charts
The 5-day TRIN (for NYSE) is NEUTRAL here while the 5-day TRINQ (for NASDAQ) is nearing a SELL signal.
Components of SPX above their respective 200day MA Chart
This past week, the 56%-57% level we were watching closely, held and we are now at 63%. Once we get past 65%, then the next target is 75% (as SPX nears its ATHs).
SPX SKEW (Tail Risk) Chart
SPX SKEW (Tail Risk) = 124 and at its -1 sigma (normal = 120-125, range 100-150)
All Quiet on the Mid-Western Front? Yes.
And oh, btw, that has uber-bored my co-pilot, @Capt_Tiko, and lead him to take more union breaks (cat-napping on the job). LOL.
3-month VIX Futures Spread(VX) Chart
Our 3-month VIX Futures Spread (LONG APR16 & SHORT JUL16) closed Friday at about -3.3. This reading continues to warn us about pending resistance in SPX but AuntieJanet and her flock are not listening. Stay Alert, sailor.
HA_SP2 = 80.36 (Buy signal <= 25, Sell Signal >= 75)
At ~80+, this prop indicator is back to OVERBOUGHT zone again.
2002 & 2008 Analogs have failed (this is not uncommon at this time of the year). So, for now we are keeping track of 2012 Analog.
SPX 2012 Analog for SPX 2016
Are we going to turn down? Most likely after we hit a new SPX ATH at 2135. The question, as always, becomes what will be the catalyst? stay tuned sailor......
US Treasury T-Notes & T-Bonds Yields Chart
US Treasury Yield Curve continued to retreat this past week into its MONTHLY PIVOT Levels as US Treasury Complex Prices, at the margin, rallied a tad. NO Signal here.