Thread: coolhand's Account Talk

Just a quick update this evening. The market closed mixed on the day. No changes to my sentiment, which is neutral to modestly bullish.

The 3rd up-leg continued today with price closing with solid gains.

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We can see that price is now making a run toward the 200 dma on both charts. Momentum is rising and volume was robust.

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Breadth is looking very good and remains solidly bullish.

It will be interesting to see what the next NAAIM reading will be, which is tomorrow. I remain neutral to modestly bullish.

After putting some gains together earlier in the week, the market pulled back a bit today, which does nothing to hurt the uptrend.

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Both charts still look good as price continues to whittle away at yearly losses. The 200 dma is really not far off and is almost certain to get tested.

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Breadth remains bullish.

The big news of the day is that NAAIM got bullish. Maybe not over-the-top bullish, but there was a large increase in bullish positions. That's a green light for the bulls in my book.

I am now bullish.

Last week was mixed for the averages. The S&P was down modestly, while the DWCPF tacked on more than a 2% gain, which is impressive given the selling at the end of the week.

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Another bull flag in the making? I think that's likely, but we'll need to see if the 50 dma holds as support. Momentum has gone largely flat.

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Breadth remains bullish, but it is under attack.

Last Thursday, NAAIM showed a significant increase in bullish positions among these smart money managers. I view this reading as bullish. TSP Talk came in neutral.

The end-of-month selling comes as we head into the historically weaker part of the year. There are plenty of negative headlines to stoke bearish sentiment too. So, why is NAAIM getting more bulled up? This is not a precision sentiment reading, but it tends to be accurate much more often than not.

Let's see how the new week starts. I've seen headlines that more selling is likely, but that's not the market talking. I remain bullish for now.

The market opened weak in morning trade, rose shortly after and leveled off until the early afternoon when the bulls pushed price into positive territory and closed out the day in the green. Sound familiar? Once again, a floor seems to be under this market.

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So far, the 50 dma is holding. The reversal suggests the market may be ready to move higher again.

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Breadth remains bullish, but has not turned back up yet.

Remember, NAAIM flipped bullish last week, so that's another reason to look for rising prices. I remain bullish.

The bulls managed to continue the upside move that began on Monday, though a good portion of the gains were erased in late day trading. That doesn't mean all that much in and of itself. What we are likely seeing is what we've seen previously, which is an overall move to the upside over a period of days.

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On this particular upside swing, we need to see price hit a higher high. A higher high would coincide with a test of the 200 dma. I think it's a reasonable expectation right now. I'd like to see momentum turn back up, which it should if we get that test.

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Breadth ticked up a bit and remains bullish.

My sentiment is still bullish, just like NAAIM.

The market had a choppy day today, spending time above and below the neutral line. At the close, prices were moderately lower.

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The charts still look good as far as the up-trend goes, but resistance is likely going to continue serving as a headwind. Momentum is flat.

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Breadth dipped again and is now neutral. I don't see this as a concern given the charts remain in a stable up-trend.

NAAIM reports tomorrow. I remain bullish.

The bulls bounced the market today, but the sellers came in later in the trading day and erased some of the gains.

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The charts still good from a bullish perspective.

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Breadth ticked higher and is back to a bullish stance, but not by a lot.

NAAIM saw a decrease in bullishness, but the bearishness also saw a small decrease. In essence, it looks like a few bulls and a few bears went neutral. This does not affect the overall bullish disposition of the market, but does indicate more choppy action ahead that slowly resolves higher. I don't think the market is ready for any launches to the upside, but there still appears to be a floor under it as well.

I remain bullish overall.

CH,

Can you briefly summarize, if it’s not too much trouble, what the data in the columns on the NAAIM mean? I’ve looked all over to find an explanation but have come up dry. TIA.

Originally Posted by hotwings

CH,

Can you briefly summarize, if it’s not too much trouble, what the data in the columns on the NAAIM mean? I’ve looked all over to find an explanation but have come up dry. TIA.

I am not intimately familiar with it myself, but you're right, there isn't any explanations. But I've listened to a Wall Street professional for many years who used that data in his market analysis and became comfortable with the NAAIM reading enough to use it for my own purposes. I look at the readings from a general perspective. I think the numbers represent how leveraged (overall) the managers are (50%, 100% 200%, etc). And a reading is derived on the site for the overall sentiment. It is not clear to me exactly what the columns represent, but it could be that the columns represent groups of money managers. How they are assigned to the columns I do not know.

It is important to remember that when dealing with sentiment there is room for flexibility. So we can look at the overall number (Mean/Average) as a soft representation of the overall sentiment of the managers themselves. The higher the number, the more bullish they are. Midway is neutral. A lower reading gets into bearish sentiment. You will also notice the columns increase and decrease as the Mean/Average is calculated.

As nice as it would be to have a better understanding of how this entity uses and manages this info, we don't really need it to understand the overall sentiment picture.

CH,

Thanks and I totally agree with your last statement “ As nice as it would be to have a better understanding of how this entity uses and manages this info, we don't really need it to understand the overall sentiment picture.”
Cheers!