Happy Thanksgiving everyone. I have missed a few posts due to a trip and medical complications. You can find my full analysis free and open to the public at navigatethemarketstorm.com
Both of my Swing Trade Signals remain BULLISH since early in the week.
I replaced the Oil chart with 2 SPX related charts, SPX:VIX (which should peak at high SPX price and low VIX), and SPXEW (which asks the question what if each SPX stock had equal weighting). Well, both of them support my past claims a big vacuum is developing, with negative divergences across the board in October.
SPX daily remains at an All Time High despite negative divergences across the board since at least March 2017, and countless Hindenburg Omens since this summer. Still feel its likely that a major market top is close by. SPX hourly shows some astounding negative divergences that go back to early October on several indicators. All indicators are diverging negatively. This also supports my theory we are near a major top.
My proprietary Technicals Model was higher for the 6th day in a row, with a positive divergence at 9/1's peak vs. SPX, foretelling of this bullish run. The Model made a nominal new high in early October which could be counted as a double top. The Cumulative version of the Technicals Model made a new All Time High 11/24. My statistically driven Volatility Model may be waking up from historically low levels. I foresee further volatility developing based on this and historically narrow SPX Daily Bollinger Bands.
VIX finished lower today, on a MACD BUY signal. However at recent lows the only positive divergence was with MACD histogram, so a lower low is likely. VIX 15 minute chart shows positive divergences on most all indicators for the past several days. So a quick VIX pop is likely even though I think a lower low will eventually come.
Market Internals, participation and breadth indicators were mixed today. Many of these are in positive territory, yet are well off peaks from earlier in the year. SPX A-D line made a new All Time High on 11/21, obviously above its 20 dma which is rising. SPX McClellan has been negative for 21 of the past 22 days.
HYG:IEF formed negative divergences across the board with its peak on 10/25. It has already rolled over losing all major moving averages along at the bottom Bollinger Band. Currently its having a muted recovery, now at resistance of all major moving averages.
Finally, I took a look at the yield curve 10Y-2Y. Its now well below the Trump election date, and in fact at a reading of 0.58, one has to go back to October 2007 to see values this low. Yikes!!
Disclosure: I am/we are short SPY.