Bullish or Bearish? Week of Sept. 25, 2017

Here are the latest technical and sentiment indicators:

Technical Indicators (daily chart)

S&P 500 is above its 50-day MA = Bullish

MACD (S&P 500; 19,39,9) is above its zero line = Bullish

MACD (S&P 500; 19,39,9) is above its signal line = Bullish

S&P 500 support @ 2469 (50-day moving average)

 

Sentiment Indicators (+RSI)

II survey: (Sept. 19): 50.5% Bulls; 19.0% Bears = Bearish

AAII survey: (Sept. 20): 40.1% Bulls; 27.2% Bears = Neutral

VIX: @ 9.50 = Bearish

RSI: (S&P 500) @ 62.98 = Overbought

Comment: The S&P 500 made an all-time high of 2508.85 but then fell back to 2502. We’ll have to wait and see if there is enough energy left in this market to move much higher. It’s still a bull market but but the lack of energy tells me the end is likely near. Nevertheless, this market could go sideways for weeks or months, so caution is advised. Sentiment among retail investors is rising. Other surveys show extreme investor confidence. In addition, individual investors have been bragging to me how much money they made, which is always a signal a top is near. Need more evidence we are near a top? Lance Robert at realinvestmentadvice.com nails this market with solid evidence in his piece, “Yellen Takes Away the Punch Bowl”: https://goo.gl/aFQPsH

A word of caution: Just because we appear to be topping out doesn’t mean it’s time to buy puts (or short). Be patient and wait for clear signals. The market might still have a few tricks up its sleeve but as for me, I wouldn’t be buying heavily at the top, nor would I be shorting. Don’t forget that the technical indicators are saying we’re in an uptrend, and yet, it feels like the market is moving higher on fumes, not reality.

Bullish or Bearish? Week of Sept. 18, 2017

Here are the latest technical and sentiment indicators:

Technical Indicators (daily chart)

S&P 500 is above its 50-day MA = Bullish

MACD (S&P 500; 19,39,9) is above its zero line = Bullish

MACD (S&P 500; 19,39,9) is above its signal line = Bullish

S&P 500 support @ 2460

 

Sentiment Indicators (+RSI)

II survey: (Sept. 12): 47.1% Bulls; 20.2% Bears = Neutral

AAII survey: (Sept. 13): 41.3% Bulls; 22% Bears = Neutral

VIX: @ 10.17 = Bearish

RSI: (S&P 500) @ 64.94 = Overbought

Comment: It’s time to pay attention once again to the market as we enter the traditionally volatile September to November period. Of course, nothing about this market has been traditional, so it’s possible volatility will continue to be suppressed. But one thing I know for sure: No one, not even the Fed or the algos, can eliminate volatility forever. As the market makes all time highs while sentiment flashes warning signs, it’s advised to be on guard. No one knows the catalyst but one of these days the market is going to crumble. All we can do is look for the clues and hopefully be prepared before it happens. A more detailed analysis of the current market can be found at Lance Robert’s website, which I highly recommend: WINTER IS COMING: https://goo.gl/PPaX75

Bullish or Bearish? Week of Sept. 11, 2017

Here are the latest technical and sentiment indicators:

 Technical Indicators (daily chart)

S&P 500 is above its 50-day MA = Bullish

MACD (S&P 500; 19,39,9) is above its zero line = Bullish

MACD (S&P 500; 19,39,9) is even with its signal line  = Neutral

S&P 500 support @ 2450 and 2400

 

Sentiment Indicators (+RSI)

II survey: (August 29): 49.5% Bulls; 19.1% Bears = Neutral

AAII survey: (August 30): 25.0% Bulls; 39.9% Bears = Neutral

VIX: @ 12.12= Bearish

RSI: (S&P 500) @ 52.34 = Neutral

No comment this week because of the hurricane (I’m in the middle of it). 

Bullish or Bearish? Week of Sept. 4, 2017

Here are the latest technical and sentiment indicators:

 Technical Indicators (daily chart)

S&P 500 is above its 50-day MA = Bullish

MACD (S&P 500; 19,39,9) is above its zero line = Bullish

MACD (S&P 500; 19,39,9) is even with its signal line  = Neutral

S&P 500 support @ 2450 and 2400

 

Sentiment Indicators (+RSI)

II survey: (August 29): 49.5% Bulls; 19.1% Bears = Neutral

AAII survey: (August 30): 25.0% Bulls; 39.9% Bears = Neutral

VIX: @ 10.13 = Bearish

RSI: (S&P 500) @ 60.13 = Neutral

Comment: As expected, the market took a hit last week, but the selloff lasted only an hour before the computer algos entered the market with buy orders, and the market went higher. Overnight, geopolitical concerns set the S&P futures back a little but it recovered. Bottom line: The bullish algos are in control. One day the uptrend will change to a downtrend and the algos will change strategies, but until that day arrives, be cautious and conservative with your trades.