For several months the US stock market has had several bearish momentum divergences, both external and internal. External moment can be gauged by price oscillators such as Stochastic. Internal momentum can be viewed by examining advancing issues vs. declining issues. Since February 2021 the Nasdaq -Advancing – Declining Issues ($NAAD) has had bearish divergences vs.Continue reading “Another Bearish Divergence”
Category Archives: Momentum
The Never-Ending Bull Market
After sixteen-months of steadily rising stock prices in which the largest correction was only 10%, complacent bulls probably think it will never end. For analysts that study all four market dimensions, in particular momentum- realize its more like a hidden bear market. The daily Nasdaq – Advance – Decline Issues ($NAAD) chart courtesy ofContinue reading “The Never-Ending Bull Market”
Buy the Dip
After sixteen months of a relentless bull market, stock fund managers have learned the lesson: when stocks decline go in and buy. The hourly S&P 500 (SPX) chart courtesy of Trading View illustrates the recent action. The SPX move up from the 07/19/21 bottom is the fastest and farthest rally since the move from theContinue reading “Buy the Dip”
S&P 500 – Downside Target Zone
Today’s – 07/19/21 sharp decline broke below the micro-crash bottom made on 07/08/21 and could be the kickoff of a larger developing drop. Momentum evidence supports this theory. Daily RSI is 43%, the oversold zone begins at 30%. Daily MACD had a bearish line crossover. The daily S&P 500 (SPX) chart courtesy of Trading ViewContinue reading “S&P 500 – Downside Target Zone”
Leading to the Downside
This sites 7/10/21 post “Momentum Continues to Deteriorate” illustrated the Nasdaq Composite – Advance/Decline line ($NAAD) had bearish momentum divergences. A case can be made that this indicator along with another A/D line are leading US stocks lower. The daily chart courtesy of Trading View illustrates the NYSE Composite (NYA), S&P 500 (SPX), and NasdaqContinue reading “Leading to the Downside”
Bearish External Momentum Indicators
The weekly S&P 500 (SPX) chart courtesy of Trading View illustrates two external momentum indicators. The highest weekly RSI reading for the entire secular bull market 2009 to 2021 occurred at the January 2018 peak. Subsequently there was a double bearish divergence at the February 2020 top. followed by a one-month crash. The maximum RSIContinue reading “Bearish External Momentum Indicators”
Momentum Continues to Deteriorate
As the S&P 500 (SPX) and Nasdaq Composite (IXIC) continue to climb, internal momentum indicators are becoming more bearish. The 06/29/21 blog “Historical Perspective of Stock Market Momentum” illustrated the Bullish Percentage Index for the SPX ($BPSPX). The daily $BPSPX chart courtesy of StockCharts.com shows the activity as of 07/09/21. On 07/08/21 $BPSPX made aContinue reading “Momentum Continues to Deteriorate”
The Next S&P 500 Resistance Level
Within Elliott motive waves there’s usually a price and or time relationship between waves “one” and “five”. The most common relationship is the Fibonacci ratio of 1/1 – equality. The monthly S&P 500 (SPX) chart courtesy of Trading View illustrates a presume Elliott five – wave motive pattern under development since March 2009. WhenContinue reading “The Next S&P 500 Resistance Level”
End of the Quarter – End of the Bull Market?
Today 06/30/21 the S&P 500 (SPX) made a new all-time high unconfirmed by the Nasdaq Composite (IXIC) and Dow Jones Industrial Average (DJI) – a “rule of the majority sell signal”. Additionally, the VIX made a higher bottom vs. the SPX new high, a bearish signal. For the last few months there have been severalContinue reading “End of the Quarter – End of the Bull Market?”
Historical Perspective of Stock Market Momentum
The momentum of stock markets can be examined by external indicators that measure price. Some of the external momentum indicators are Stochastic and RSI. Internal momentum indicators measure components of stock indices, such as Advanced/Decline lines and 52 – week Highs/Lows. The 06/28/21 blog examined recent deterioration of new – 52 – week highs forContinue reading “Historical Perspective of Stock Market Momentum”
