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Coolhand's Market Analysis

Market Poised to Resume Upside bias? Posted by Coolhand

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by
coolhand
, 01-06-2021 at 04:47 PM (2530 Views)
Quote Originally Posted by coolhand View Post
The rally may have faded a bit today, but it still closed with good gains.

Daily Funds Returns-spx-png
Daily Funds Returns-dwcpf-png

I note that both charts show price probing fresh all-time highs today, but neither was able to close at that level. However, this market could propel past resistance (we're still in a bull market after all). I suspect it will, but I'm not sure the market is ready for it just yet. Momentum is starting to turn back up on the DWCPF, but is still flat on the S&P.

Daily Funds Returns-nyad-png

Cumulative breadth is looking better and remains bullish. This signal has been bullish for more than 2 months now.

I went neutral earlier this week because of the transition from one year to the next and the fact that the indexes were struggling a bit (especially the DWCPF). Now, we have a 2-day rally that has retraced a good portion of previous losses, which makes me wonder if the rally if ready to now continue. NAAIM was moderately bullish and if the market continues to bias higher they are likely to remain that way when we see the latest sentiment reading tomorrow.

I'll stay neutral for now.

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  1. joblin20's Avatar
    With the feds having the stock market back, is it even possible for the market to crash?
  2. coolhand's Avatar
    Quote Originally Posted by joblin20
    With the feds having the stock market back, is it even possible for the market to crash?
    That's been one of the secrets to my bullishness. Who has control? I've said in the past that "someone" wants this market higher and they've been pushing it in that direction for quite some time now. Without getting into specifics, it's possible the market doesn't crash, but not a guarantee. That's also one of the reasons I watch NAAIM. They have not been beared up when so many others were screaming about this overbought market. If they do get beared up, that's reason to get defensive.

    The only reason I went neutral earlier this week was to see how the transition went from one year to the next; especially given the end-of-year weakness. I did not get bearish, I only decided to take a wait and see approach for a short while.

    Having said that, the latest NAAIM reading (today) shows the smart money increasing their bullishness. So I am moving from neutral back to bullish.
  3. jstrime's Avatar
    First, thank you for all you offer to TSP investors. My official 2020 return was 26%, certainly very good considering where my TSP was on 3/23. I went to G fund on Dec. 22 from 80/20 S/C funds. But yesterday morning I gave in and converted back to 60/40 S/C for today, probably should have stayed with 80/20, but have another ift (plus G fund) for the month. I believe with a new administration across the board, the powers that be don't want a major correction on their hands... Stocks are going higher.

S&P500 (C Fund) (delayed)

(Stockcharts.com Real-time) 		DWCPF (S Fund) (delayed)

(Stockcharts.com Real-time) 		EFA (I Fund) (delayed)

(Stockcharts.com Real-time) 		BND (F Fund) (delayed)

(Stockcharts.com Real-time)
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