Thread: coolhand's Account Talk

Missing the Cool; hope all is well. A Happy Summer to you.

Yes missing your views cool!
Always great insight from you man!


Sent from my iPhone using Tapatalk

Sorry for the absence. Had to leave my home and computer for another week to attend to a private family matter. Got back home and my main computer isn't working.

Originally Posted by coolhand

Sorry for the absence. Had to leave my home and computer for another week to attend to a private family matter. Got back home and my main computer isn't working.

Welcome back! Hope everything will be ok! I think a lot of people here missed your input including me, but family comes first.

I have not even looked at the stock market in more than a week, so let's see what we have.

S&P 500.png
DWCPF.png

Obviously, the past week was not favorable to the bulls. Price closed below the 50 dma on the S&P and is testing that average on the DWCPF. But I do see that the S&P hit a fresh, closing all-time high a few days ago. That didn't last long. Volume was also heavy on Friday. Momentum is falling on both charts and is also negative.

NYAD.png

Breadth went negative on Friday and has been falling for about a week.

So, we have a short-term(?) down cycle that is now turning indicators negative. Last week, NAAIM was somewhat bullish overall, but this week they have increased their leverage on the long side, but a small bear contingent within their group is modestly playing the short side. The reading is solidly bullish overall. Our TSP sentiment survey is neutral.

Since the smart money is not only not backing off their bullishness (it increased), but increasing their leverage on the long side, I suspect a bottom is likely near. The indicators going negative at the end of the week supports that perspective as well. But our own survey is neutral (and some NAAIM managers are modestly bearish), so maybe the market chops around for a bit first. I will remain bullish on the S&P and neutral to modestly bullish on a the DWCPF, but I am anticipating that it may be a few days before the long side gets traction again. We'll see.

Welcome back CH. pray that all is well.

The MACD on the charts u provided are rolling over with the blocks trending negative. I saw very unusual spike in trading volume on Friday's selloff during the last 30 minutes. The NYSE volume during the last 30 minutes was more than twice the volume for the trading day up to that point. Appears that advancing issues have been declining all week & the declining issues accelerating. I did not sense an exhaustive sell on Friday...felt more like a wave down starting to me. What has got me concerned is inflation numbers are more serious than the Federal Reserve is telling us. I do expect interest rates to rise early next year instead of 2023. Key indicators that will slow the economy down...high material costs, shortages in the chip industry, housing prices, energy, food, auto prices, and expanding debt. Easy money will become tight & companies that have propped up their stock with stock purchases will find their debt levels difficult to manage putting a drag on earnings. We need to get back to more reasonable market P/E numbers. We are near the dotcom bubble bust. Growth stock rotation is where the money is going. I see overbought conditions there though. Profit taking soon. Expect market to decline short term. We need a bigger correction or I fear stock growth will be lethargic.

I don't disagree with you at all. You are correct. But a manipulated market does not care about reality. It's all smoke and mirrors. Eventually, reality does catch up with the manipulators, but that usually takes years. Having said that, it's been years so maybe we are approaching something more profound. Smart money says we aren't there yet, but you can never be entirely sure.

I had suspected a bottom may be near, but thought it might be a few days yet before the market got solid upside traction. It was more like a few hours. The very next day the market reversed and tacked on sizeable gains.

S&P 500.png
DWCPF.png

Price snapped back to the upside off support at the 50 dma on both charts. Momentum halted its downward movement for now. Strength (RSI) ticked higher.

NYAD.png

Cumulative breadth also snapped higher and flipped back to positive in the process.

The short term downward cycle may be over. Monday's rally may be strong enough to turn momentum back up. The DWCPF has still not broken out of its long-term sideways dance and that could keep a lid on the upside. I remain bullish on the S&P and neutral to modestly bullish on a the DWCPF.

So is this the end of sell in May and go away? I've been sitting on the sidelines chomping at the bits....

Sent from my Pixel 4a using Tapatalk

Much to the consternation of those sitting on the sidelines, the market made it 2 in a row today as the bulls pushed price back up near resistance once again.

S&P 500.png
DWCPF.png

Both charts show price not far under its previous high. A test sure looks likely. Momentum is rising, but not so you'd notice much.

NYAD.png

Cumulative breadth ticked higher on the day and that keeps the signal bullish.

It didn't take long for the bulls to recapture much of last weeks losses. NAAIM got fairly bulled up, so I'm thinking there's more upside. The question is, can price get past resistance; especially on the DWCPF.

I remain bullish on the S&P and neutral to modestly bullish on the DWCPF.