Slope of Hope Blog Posts
This is the heart and soul of the web site. Here we have literally tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. You can also click on any category icon to see posts tagged with that particular category.
Further to my post of March 10, we may be seeing the beginnings of a 10th year bull run, inasmuch as volatility of the SPX, NDX, and RUT has been attempting to stabilize recently.
However, this attempt is not yet a slam dunk. As noted on the following daily ratio charts of the SPX:VIX, NDX:VXN, and RUT:RVX, I’m still waiting for:
SPX:VIX ratio: a bullish crossover of the 50 MA above the 200 MA to form a Golden Cross
NDX:VXN ratio: a bullish crossover of the PMO technical indicator
RUT:RVX ratio: a bullish crossover of the PMO technical indicator
All other technical indicators must continue to hold their present bullish formations, and price needs to hold above their respective major support levels, namely: (more…)
As shown on the daily chart below, a moving average “Death Cross” has formed on the World Market Index. It closed out Q2 2018 just above horizontal price support and below trendline support, as well as below both moving averages.
All three technical indicators are in negative territory, hinting of further weakness ahead, particularly if price drops and holds below 1950 on accelerating RSI, MACD and PMO declines.
Price action on the following monthly chart of China’s Shanghai Index has been under the bearish influence of a very long-term downtrending Andrew’s Pitchfork channel since it peaked in October 2007 and bottomed the following October.
After a weak attempt to break out above this channel at the end of January of this year, it retreated and is currently dropping early Tuesday morning following President Trump’s latest threats several hours ago to impose tariffs on an additional $200 billion worth of Chinese goods in connection with their recent trade war. It has broken below its near-term major support level of 3000 that I had identified in my posts of April 9 and February 16.
If this index returns to its channel “median,” it’s in for one heck of a plunge! Look for a break and hold below its last swing low at 2638.30 to continue its current downtrend on this monthly timeframe. It’s already in downdrend on the weekly and daily timeframes following its failed channel breakout attempt and the momentum indicator is firmly in downtrend on all three timeframes. (more…)
From the daily percentage comparison chart below of the four U.S. Major Indices, you can see that the Nasdaq 100 and Russell 2000 Indices have begun to surge above their recent all-time highs and have accelerated faster than their Dow 30 and S&P 500 counterparts.
The spread between the first two and the latter two indices is ever-widening and higher risk investing is on the rise…signalling that, either this latest surge is the beginning of a new bull market that would, ultimately, pull in the Dow and S&P and send them to record highs, as well, or is in the process of forming a climatic thrust before the end of a very long bull run that began when stocks plummeted to their lows on March 6, 2009, following the 2008/09 financial crisis.
With today’s drop in these markets (as of 12:40 pm ET), presumably in response to further tariffs imposed on China by President Trump, we’ll see how escalating world-wide trade wars, inflation, and Central Bank interest rate actions affect/infect U.S. (and world) markets in the coming weeks. (more…)
A NO-WIN FOREIGN POLICY
It’s clear that President Trump’s “America First” policy does not produce a “win-win” outcome for it and other world trading partners…at least, it has not been proven, yet.
So far, he’s only been successful in tearing up prior agreements related to the Trans Pacific Partnership, the Paris Climate Agreement, the Iran JCPOA, and has threatened to tear up the NAFTA with Canada and Mexico.
Although he is in current trade talks with China, he has not been successful in negotiating a new trade agreement with Canada and Mexico, nor has he been successful in negotiating any other bi-lateral or multi-lateral agreement that I’m aware of, including a peace agreement between Israel and the Palestinians.
In fact, he has exacerbated tensions in current NAFTA negotiations by slapping hefty and punitive steel and aluminum tariffs on these two closest trading allies, as well as on the European Union…under the guise of “national security” concerns. (more…)
In my last post on the S&P 500 Index (SPX), I mentioned 2750 as major resistance and 2680 as near-term support.
Since then, price has bounced around in between those levels, as shown on the daily chart below. At the moment, those two levels are confirmed by a variety of intersecting trendlines…most notably the two red horizontal lines (2748 and 2685), which are the nearest to these two levels.
Until we see a clean break and hold either above or below this red consolidation zone, the SPX will continue its sometimes extreme, volatile whipsaw action in a trendless manner.
It’s unclear whether momentum favours a breakout to the upside, inasmuch as the last swing high on the momentum indicator was lower than its previous swing high, in a divergence with the last two swing highs made by the price. However, this may have been intentional and meant to be used as a possible “bear trap” in preparation for the resumption of the rally that began in early April. (more…)
The following year-to-date graphs of the U.S. Major Indices and Major Sectors show that market participants have favoured riskier technology, small-cap, and consumer cyclical stocks.
As Israel prepares for the relocation of the US Embassy from Tel Aviv to Jerusalem on Monday, the Tel Aviv 125 Index (TA125) appears to be poised for a rally.
Price closed on Friday just above major support of 1325 and is trading in between the 50 and 200 moving averages, as shown on the following daily chart.
A break and hold above the 50 MA at 1337, along with a rise in the RSI above 50 and further strength in the MACD and PMO indicators, could see price retest 1400, or higher. The higher swing high on the RSI is hinting of further strength. If such a scenario were to materialize, it’s important that the 50 MA remain above the 200 MA, lest we see a bearish Death Cross form, followed by selling. (more…)
My last post on Bitcoin made reference to a bearish engulfing candle that had formed on the daily timeframe.
Since then, its price drifted slightly upwards, then plunged and closed below the low of that candle on Friday, as shown on the following daily chart.
The momentum and rate-of-change indicators did not confirm the recent higher price high, but are both in an accelerating diverging downtrend, and are below their zero levels.
TPO stands for Time Price Opportunity. By using a TPO profile chart, you are able to analyze the amount of trading activity, based on time, for each price level that the market traded at for any given time period. The Point of Control (POC) is the price where it spent the most time during that period and in that timeframe.
If you look at the following monthly chart of the VIX with the TPO profile study added to it along the right hand side, you’ll see that its POC (on a monthly basis) since 1986 is 20.53.
Whereas, the TPO POC on a daily timeframe from 1986 is 14.66, as shown on the daily chart below.
This tells me that the average “normal” range of the VIX during the past 33 years is between 14.66 and 20.53, regardless of its trading activity on either a monthly or daily timeframe.
I’d also go a bit further and say that any time it traded outside that range for any length of time, it was “unusual” and, therefore, unsustainable…something to consider when you’re taking longer position trades in equities.
As of Thursday’s close, the VIX was trading in “unusual” territory at 13.23…below the “normal” range, where it has spent most of its time since the November 2016 general election.
The last time it spent the majority of its time below the “normal” range was from 2005 to 2007 leading up to the 2008/09 financial crisis. (more…)