Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24
How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - 17th Feb 24
Why Rising Shipping Costs Won't Cause Inflation - 17th Feb 24
Intensive 6 Week Stock Market Elliott Wave Training Course - 17th Feb 24
INFLATION and the Stock Market Trend - 17th Feb 24
GameStop (GME): 88% Shellacking Yet No Lesson Learned - 17th Feb 24
Nick Millican Explains Real Estate Investment in a Changing World - 17th Feb 24
US Stock Market Addicted to Deficit Spending - 7th Feb 24
Stocks Bull Market Commands It All For Now - 7th Feb 24
Financial Markets Narrative Nonsense - 7th Feb 24
Gold Price Long-Term Outlook Could Not Look Better - 7th Feb 24
Stock Market QE4EVER - 7th Feb 24
Learn How to Accumulate and Distribute (Trim) Stock Positions to Maximise Profits - Investing 101 - 5th Feb 24
US Exponential Budget Deficit - 5th Feb 24
Gold Tipping Points That Investors Shouldn’t Miss - 5th Feb 24
Banking Crisis Quietly Brewing - 5th Feb 24
Stock Market Major Market lows by Calendar Month - 4th Feb 24
Gold Price’s Rally is Normal, but Is It Really Bullish? - 4th Feb 24
More Problems in US Regional Banking System: Where There's Fire There's Smoke - 4th Feb 24
New Hints of US Election Year Market Interventions & Turmoil - 4th Feb 24
Watch Consumer Spending to Know When the Fed Will Cut Interest Rates - 4th Feb 24
STOCK MARKET DISCOUNTING EVENTS BIG PICTURE - 31st Jan 24
Blue Skies Ahead As Stock Market Is Expected To Continue Much Higher - 31st Jan 24
What the Stock Market "Fear Index" VIX May Be Signaling - 31st Jan 24
Stock Market Trend Forecast Review - 31st Jan 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stocks Bulls Relentless... No Thrust...Grinding Higher...

Stock-Markets / Stock Markets 2016 Aug 16, 2016 - 10:04 AM GMT

By: Jack_Steiman

Stock-Markets

You have to hand it to the bulls. They are a relentless group that never wants to throw those bears a bone. They're getting a bit selfish aren't they? I mean, come on, every once in a while, the bears have to get some love. Don't they?! The news overseas on the economic front over the weekend wasn't good, yet, even though some foreign markets were down, our futures seem to know of only one direction. The low of the day was the open, but overall the S&P 500 traded in only a seven-point range for the entire day. When the VIX gets this low it's harder for the market to flash major-league volatility. It gets a bit boring, for sure, but that's the price you pay for increasing froth, which is clearly what's taking place here.


It's quite possible that Wednesday's number will show the bull/bear spread at a very dangerous, historical level of 35% or better. We came in to last week at 33.4%. With a decent market last week, seeing 35% is not out of the question. In this market we may need a lot higher than 35%, but I have to tell you that under normal circumstances, when you hit 35%, it's a get-out-of-the-market reading. Low VIX. Froth ramping. You know the story by now. No classic sell signal, but respect the market at all times. The risk is very high, even though we're not seeing it in price at this moment in time. So we're grinding higher in a very low VIX environment. This tells you to lower your expectations of big moves north, and to, again, realize that a huge move down can occur at any time without warning. Keep it long, but keep it appropriate.

Facebook, Inc. (FB), Amazon.com Inc. (AMZN), Netflix, Inc. (NFLX), and Google Inc. (GOOG), were all red today on a day when the Nasdaq was the best performer. Not sure what to make of it, but it is interesting. The bulls can say that things are beyond great. To move the Nasdaq decently higher on a day all the normal leaders were red shows the continuing rotation we've seen for years. The bears can say that when an index breaks out, such as the Nasdaq is doing, you want to see the leaders lead, and today they did not. Truth is, it's probably nothing from nothing, but when markets get too frothy, and get a bit tired and riskier, you often see the leaders pull back first and then eventually all the rest follow along.

I'm not sure if that's about to happen here, but we can add in negative divergences again on the sixty-minute charts just about everywhere, so just be aware is all. Oh, and also another tag of 70 RSIs on the sixty-minute index charts when the market was at its highs today. You really have to wonder how much longer this grand disconnect can keep moving along to the up side. It makes less and less sense every single day. It feels like we should be crashing out, and yet, we grind higher. I don't know folks, I would just keep it appropriate, but, of course, do what feels right to you. Bottom line is above 2134 we're all good.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 15-Day Trial to SwingTradeOnline.com!

© 2016 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in