Monday, April 20, 2015

CPC Put/Call Ratio Daily Chart Signals Market Top

The roller coaster ride continues. One day up one day down; is tomorrow the bear's turn again? The TRIN chart posted on the weekend wanted a quickie relief rally due to the 4.00 number which occurred today. For the CPC above, you typically want to see a 1.20 or higher to know that you have a firm stock market bottom to go long. Today's rally occurs from a 1.13 number not exactly a ringing endorsement that a proper bottom was placed. Further, instead of the CPC dropping just a smidge say to the 0.95-1.10 area, it plummets directly back to pure complacency territory at 0.79.

Who can blame traders for remaining non-stop complacent buying stocks without any worry or fear? The central bankers are the market. The PBOC (China's central bank) goosed the US and European indexes today with the triple R cut to their banks. The global central bankers will send stocks higher forever to make the wealthy, that own stocks, richer, so why worry? It's like having a rich uncle that always bails you out. There is never any reason to change your behavior. Uncle Sam will be there with the dough to beat the rap.

The low CPC 0.79 identifies complacency and another near-term market top. The stock market may be getting shaky from all the whipsaw behavior. Watch your wallet. Markets should place another top any day forward and selloff until the CPC moves above 1.20. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Keybot the Quant Turns Bullish

Keystone's algorithm, Keybot the Quant, whipsaws back to the bull side at SPX 2096 after this morning's opening bell. The erratic choppy sideways behavior continues this year. As always, watch for a potential whipsaw back to the short side. Pay attention to copper; it will pivot overnight and influence broad market direction; of course positive copper will lead to higher stocks tomorrow and negative copper will lead to market weakness. More information is found on Keybot's site;

Keybot the Quant

SPX 60-Minute Chart 200 EMA Cross

The bulls and bears continue the sideways battle this year. The 200 EMA on the 60-minute is 2084.62 moving flat sideways. The SPX is below which signals bearish markets for the hours and days ahead, however, the S&P futures are up +12 as the week is set to begin trading shortly. This would send the SPX above 2090 and above the 200 EMA signaling bullish markets for the hours and days ahead.

The battle at 200 EMA will likely continue all day long so pay close attention; it is extremely important which side price favors since it charts the path ahead. As the SPX Support, Resistance and Moving Averages missive highlights on the weekend, 2091 is very strong resistance. The bears need to hold 2091, otherwise, price will set its sights on 2099 R. A cluster of S/R exists at 2084-2085 including the 200 EMA above, the 50-day MA at 2085 and 20-day MA at 2084 so this level carries serious clout. Bulls win big above 2085. Bears win big under 2084. The stage is set for today's drama.

The indicators are positively diverged except for the MACD line that would like to see another lower low. The MACD line remains sloping lower on the 2-hour chart as well. The TRIN pegged 4.00 on Friday during the market selling signaling a need for a relief rally move which appears on tap. Markets may recover today for a few hours, or into tomorrow but the door remains open for lower lows in price. Watch the fight for the 2084-2085 line in the sand. Bulls will be on easy street if the 2091 and 2099 resistance levels give way to the upside. Bears need to hold 2091 and then push price under the critical 2084-2085 level. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 8:04 AM: The bulls rocket higher today reversing Friday's losses. The SPX launched higher out of the gate and closes at 2100 well above the 200 EMA at 2086 signaling bullish markets for the hours and days ahead. Bears need the SPX under 2086 or they got nothing. Price ran up through the strong 2091 R so it targeted 2099. Price ran up through 2099 R so it targeted 2104 R. Price HOD is 2103.94 hitting its head on the 2104 resistance and receiving a slap down. Thus, price is playing around with 2104 resistance and 2099 support. Bulls win above 2104. Bears win below 2099.

Sunday, April 19, 2015

SPX Support, Resistance (S/R), Moving Averages and Other Important Levels for Trading the Week of 4/20/15

SPX (S&P 500) support, resistance (S/R), moving averages and other important levels are provided for trading the week of 3/16/15. Levels shown in bold are strong resistance and support. Bold and underlined levels are very strong and important S/R. The SPX all-time intraday high is 2119.59 on 2/25/15 and the SPX all-time closing high is 2117.39 on 3/2/15. The low for this year is 1980.90 which identifies the starting point of the huge February rally.

For Monday with the SPX starting at 2081.18, the bulls need to recover all of Friday’s losses pushing above 2102 to get their mojo back and accelerate the upside. Bears need to push under 2072 to accelerate the downside. A move through 2073-2101 is sideways action to begin the week. The SPX began the year at 2059 so stocks are slightly positive on the year up +1.1%. April began at 2068 so the month is currently a hair positive up +0.4% with nine trading days remaining.

The 2084-2085 creates strong overhead resistance as shown by the moving averages. The 200 EMA on the 60-minute at 2085 is a critical near-term bull-bear signal. Bears win big if the SPX remains under 2085. Bulls win big above 2085. Pay close attention to the 20-day MA at 2084 and 50-day MA at 2085. Bears are in great shape if price stays under these two moving averages. Bulls will rule above these two MA's. Watch the 20/50 cross; the 20-day is under the 50-day MA which gives the market bears the upper hand. Bulls will not confirm upside mojo until they push the 20-day MA back above the 50-day MA.

On the lower side, a breach of the very strong 2076 support will lead to an immediate test of 2071-2073 for a bounce or die decision. A failure at 2071-2073 will result in an immediate flush to the 2065-2067 support gauntlet where another bounce or die decision would occur. A battle at 2067-2068 will determine if April is an up or down month.

For Monday, if bullish you want SPX above 2085 to begin an upside party celebration that will tag 2091 in quick order. If 2091 gives way price will jump to 2099. If bearish, you want 2076 to fail, then 2072 since price will then be in the 2060’s in a heartbeat.

Looking at the big picture the strongest S/R is 2120, 2118, 2110, 2108, 2104, 2099, 2091, 2081, 2076, 2067, 2061, 2046, 2040, 2038, 2032, 2030, 2023, 2019, 2011, 2002-2003, 1997-1998, 1993, 1988, 1985-1986 and 1982. The SPX moves choppy sideways through the 2000-2100 range for the last six months. The uber strong S/R levels in this range are 2076, 2067 and 2040. Pay attention to the price moves at these three important levels. Bulls are winning big above 2076 while bears will rule under 2040.

2120 (2/25/15 All-Time Intraday High: 2119.59)
2118 (3/2/15 All-Time Closing High: 2117.39)
2115
2114
2111.91 Previous Week’s High
2111
2110
2108
2105
2104
2102.58 Friday HOD
2101
2100
2099
2097
2094 (12/29/14 Intraday High: 2093.55)
2091 (12/29/14 Closing High: 2090.57)
2089
2084.98 (50-day MA)
2084.62 (200 EMA on 60-Minute Chart a Keystone Market Turn Signal)
2083.81 (20-day MA)
2082
2081.18 Friday Close – Monday Starts Here
2081
2079 (12/5/14 Intraday High: 2079.47)
2076 (11/28/14 Intraday High: 2075.76)
2075 (12/5/14 Closing High: 2075.37)
2073 (11/26/14 Closing High: 2072.83)
2072.37 Friday LOD
2072.37 Previous Week’s Low
2072
2071 (11/21/14 Intraday High: 2071.46)
2069
2067.89 April Begins Here
2067
2065.88 (20-week MA)
2065
2064.59 (100-day MA)
2063
2061
2058.90 Trading for 2015 Begins Here
2057
2056 (11/18/14 Intraday High: 2056.08)
2054
2052
2050
2046 (11/13/14 Intraday High: 2046.18)
2041
2040
2038
2035.93 (150-day MA; the Slope is a Keystone Cyclical Signal)
2034
2032
2030
2029.94 (10-month MA; a major market warning signal)
2024
2023
2021
2020.04 (200-day MA)
2019 (9/19/14 Intraday High: 2019.26)
2018
2016
2015.27 (12-month MA; a Keystone Cyclical Signal) (the cliff)
2014
2012
2011 (9/18/14 Closing High: 2011.36) (9/4/14 Intraday High: 2011.17)
2009
2007.07 (50-week MA)
2007 (9/5/14 Closing High: 2007.71)
2005 (8/26/14 Intraday High: 2005.04)
2004
2003 (8/29/14 Closing High: 2003.37)
2002
2001
1999
1998
1997
1995
1993 (1/15/15 Closing Low for 2015: 1992.67)
1992
1991 (7/24/14 Intraday Top: 1991.39)
1988 (7/24/14 Closing High: 1987.98)
1986 (7/3/14 Intraday Top: 1985.59)
1985 (7/3/14 Closing High: 1985.44)
1983
1982
1981 (2/2/15 Intraday Low for 2015: 1980.90)
1979
1978
1976
1973
1970
1968 (6/24/14 Intraday Top: 1968.17)
1965
1964
1963 (6/20/14 Closing High: 1962.87)
1962
1961
1960
1958
1956 (6/9/14 Intraday Top: 1955.55)
1951 (6/9/14 Closing High: 1951.27)
1949
1947
1946
1942
1940

SPX S&P 500 Daily Chart Choppy Sideways Year Continues

The SPX starts the year at 2059 (pink line). The sawtooth, choppy sideways pattern continues for the last five months chewing up and spitting out bulls and bears alike. The SPX is in the same place as early December, at 2080-ish, but has traveled a distance of 1280 points in that time frame, over 60% of its entire point range! That is sideways choppiness. Price moves through the 2000-2100 range for nearly six months; one-half year; a 100-point range.

In January, the SPX was negative on the year then the global central banker pump in February saved the day. The SPX turned positive on the year in February and is remaining positive despite three slips under in March and April. The S&P 500 is 2081, up a paltry 22 points this year, +1.1%, after nearly four months of drama. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Saturday, April 18, 2015

CPCE Put/Call Ratio Daily Chart

The previous CPCE chart signaled a market top coming in a few days. As always, each one is a little different. The low 4/6/15 print at 0.50 signaled uber complacency and traders buying stocks on the long side without any fear or worry. Stocks sold off from SPX 2090 to 2075 intraday but if you blinked you missed it. Stocks then traveled higher continuing to place the near-term top required by the low put/call number. The CPCE only moves moderately higher at that 0.60-ish area then comes back down for another uber low reading at 0.55. With this low reading the prior chart and analysis can simply be repeated. The uber complacency signals a top occurring any day forward and in three days the top was in. 

The SPX peaks at 2110-ish and drops to 2072 during the back-half of last week; 38 handles. Okay, big deal, what next? The CPCE is up to 0.74 not yet at the 0.80 and higher level where the near term stock market bottoms have printed recently (green circles). Thus, the expectation is further selling until the negativity and fear reaches a point where a firm near-term bottom can occur (CPCE above 0.80). The prior TRIN chart spiked to a huge 4.00 which says a relief rally should occur quickly. Thus, taking the two tools (TRIN and CPCE) and combining them, markets may rally early to middle next week, to bring the TRIN back down from its loftiness, this would be in concert with the CPCE dropping back down to say 0.65 in another zig-zag move. Then the expectation would be for market selling to reinitiate and continue until the fear and panic is firmly displayed above CPCE 0.80 and higher (which will identify a market bottom).

Bring up the CPC put/call chart and you will see its uber low print under 0.80 on 4/15/15 which signaled excessive trader complacency and marked the exact top in the stock market on 4/15/15. The CPC is up to 1.12 and typically a 1.20 or higher is needed to signal excessive bearishness and identify a near-term market bottom; very similar to the CPCE set-up explained above. The stock market may need to drift lower over the next week or two (after a quickie rally due to the high TRIN) until the CPC moves above 1.20 to signal a firm stock market bottom. If the CPCE prints above 0.80 and CPC above 1.20 on Monday or any day forward you will know a firm rally is at hand and set to begin or already started. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 8:15 PM on Monday evening, 4/20/15: The relief rally desired by the uber high TRIN occurs right away today, Monday, 4/20/15, with stocks recovering most of Friday's losses. Interestingly, the CPC and CPCE put/call ratios plummet and are signaling complacency again. CPC is 0.79. The CPCE drops to 0.56. Markets are preparing to print another near-term top any day forward. The markets continue the choppy sideways behavior this year.

TRIN Arms Index Daily Chart

The previous TRIN chart scenario plays out with a market top occurring a few days after the low 0.42 print (red circle). The 0.50-ish area is uber bullish euphoria so markets need to sell off to bring everyone back to earth which they did. The red square shows where the SPX topped out at 2110-ish. Then boom; payback time. Stocks drop and the TRIN sky rockets to 4.00 a big-time spike higher so now the shoe is on the other foot.

The spike higher signals that the bearishness was off the charts on Friday and that a near-term market bottom will occur at any time in the days ahead. It would not be surprising to see a recovery move on Monday, if not, then the stock market may toy around with sideways to sideways lower bias for a couple days but the near-term rally will occur and begin since the negative sentiment ran too high as shown by the TRIN at 4.00. Reference the prior chart to get a feel on how the TRIN can be used as a timing tool; the prior chart with the uber low TRIN  forecasted the market topping process and a selloff while the uber high TRIN now forecasts a market bottoming process and near-term comeback rally to occur. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 8:15 PM on Monday evening, 4/20/15: The relief rally desired by the uber high TRIN occurs right away today, Monday, 4/20/15, with stocks recovering most of Friday's losses. Interestingly, the CPC and CPCE put/call ratios plummet and are signaling complacency again. CPC is 0.79. Markets are preparing to print another near-term top any day forward. The markets continue the choppy sideways behavior this year.

Keybot the Quant Turns Bearish

Keystone's trading algo, Keybot the Quant, flips to the bear side shortly after Friday's opening bell at SPX 2086. Semiconductors and retail stocks create the drop and in the afternoon financial stocks. Pay attention to XLF 24.17 as a key bull-bear line in the sand. As financials go, so goes the markets. More information is found at Keybot's site;

Keybot the Quant

Thursday, April 9, 2015

TRIN Arms Index Daily Chart

The TRIN prints an uber low at 0.42 yesterday verifying the excessive bullish euphoria in markets currently. Typically the extreme  low TRIN readings (red circles) identify market tops as the enthusiasm for stocks is at fevers pitch. When the TRIN rockets higher on the positive side (green circles), the negativity is too excessive and a market bottom occurs. The TRIN chart is much more of a nuanced signal than other signals. The low reading at 0.42 indicates that a market top should occur at anytime in the days ahead.

Interestingly, two prior fractals played out with a drop of 10 to 20 SPX handles over a day or two period, then stocks recover back to the current levels for one to four days, then the SPX dropped from 50 to 100 handles. So the expectation is that equities should top out at any day forward and stocks sell off until fear and worry enters the market with the TRIN running above 2.0; that will identify time to buy the dip. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Wednesday, April 8, 2015

TRAN Transportation Index Daily Chart

The trannies never printed new all-time highs this year to confirm the new all-time highs in the Dow Industrials so the stock rally has not received a Dow Theory confirmation blessing as yet. The blue channel shows a steady downward drift to the transportation stocks and that is with lower oil prices. The push lower over the last month does occur as oil prices recover. Price lost the 200-day MA, a bearish development, and now at lows comparing back to October about six months ago. Note how price back kissed the 200-day MA yesterday.

The RSI has not reached oversold conditions. The stochastics are oversold and open to a bounce; ditto the falling green wedge. So price may recover for a better back test of the 200-day MA at 8668. The pink boxes show the strong trend in the ADX. The upward trend was strong late last year but in December the strong trend disappeared and you can see the multi-month weakness that occurs to the present. The ADX is climbing again indicating a strong trend ahead and this trend is down for price.

The TRAN weekly chart indicators are weak and bleak wanting lower lows in price after any relief bounces occur. Lower transportation stocks do not portend good things for the economy. Watch price action in relation to the 200-day MA that provides a bull-bear line in the sand. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.