Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Stock Market Selloff Structure Explained – Fibonacci On Deck - 2nd Apr 20
COVID-19 FINANCIAL LOCKDOWN: Can PAYPAL Be Trusted to Handle US $1200 Stimulus Payments? - 2nd Apr 20
Day in the Life of Coronavirus LOCKDOWN - Sheffield, UK - 2nd Apr 20
UK Coronavirus Infections and Deaths Trend Trajectory - Deviation Against Forecast - 1st Apr 20
Huge Unemployment Is Coming. Will It Push Gold Prices Up? - 1st Apr 20
Gold Powerful 2008 Lessons That Apply Today - 1st Apr 20
US Coronavirus Infections and Deaths Projections Trend Forecast - Video - 1st Apr 20
From Global Virus Acceleration to Global Debt Explosion - 1st Apr 20
UK Supermarkets Coronavirus Panic Buying Before Lock Down - Tesco Empty Shelves - 1st Apr 20
Gold From a Failed Breakout to a Failed Breakdown - 1st Apr 20
P FOR PANDEMIC - 1st Apr 20
The Past Stock Market Week Was More Important Than You May Understand - 31st Mar 20
Coronavirus - No, You Do Not Hear the Fat Lady Warming Up - 31st Mar 20
Life, Religions, Business, Globalization & Information Technology In The Post-Corona Pandemics Age - 31st Mar 20
Three Charts Every Stock Market Trader and Investor Must See - 31st Mar 20
Coronavirus Stocks Bear Market Trend Forecast - Video - 31st Mar 20
Coronavirus Dow Stocks Bear Market Into End April 2020 Trend Forecast - 31st Mar 20
Is it better to have a loan or credit card debt when applying for a mortgage? - 31st Mar 20
US and UK Coronavirus Trend Trajectories vs Bear Market and AI Stocks Sector - 30th Mar 20
Are Gold and Silver Mirroring 1999 to 2011 Again? - 30th Mar 20
Stock Market Next Cycle Low 7th April - 30th Mar 20
United States Coronavirus Infections and Deaths Trend Forecasts Into End April 2020 - 29th Mar 20
Some Positives in a Virus Wracked World - 29th Mar 20
Expert Tips to Save on Your Business’s Office Supply Purchases - 29th Mar 20
An Investment in Life - 29th Mar 20
Sheffield Coronavirus Pandemic Infections and Deaths Forecast - 29th Mar 20
UK Coronavirus Infections and Deaths Projections Trend Forecast - Video - 28th Mar 20
The Great Coronavirus Depression - Things Are Going to Change. Here’s What We Should Do - 28th Mar 20
One of the Biggest Stock Market Short Covering Rallies in History May Be Imminent - 28th Mar 20
The Fed, the Coronavirus and Investing - 28th Mar 20
Women’s Fashion Trends in the UK this 2020 - 28th Mar 20
The Last Minsky Financial Snowflake Has Fallen – What Now? - 28th Mar 20
UK Coronavirus Infections and Deaths Projections Trend Forecast Into End April 2020 - 28th Mar 20
DJIA Coronavirus Stock Market Technical Trend Analysis - 27th Mar 20
US and UK Case Fatality Rate Forecast for End April 2020 - 27th Mar 20
US Stock Market Upswing Meets Employment Data - 27th Mar 20
Will the Fed Going Nuclear Help the Economy and Gold? - 27th Mar 20
What you need to know about the impact of inflation - 27th Mar 20
CoronaVirus Herd Immunity, Flattening the Curve and Case Fatality Rate Analysis - 27th Mar 20
NHS Hospitals Before Coronavirus Tsunami Hits (Sheffield), STAY INDOORS FINAL WARNING! - 27th Mar 20
CoronaVirus Curve, Stock Market Crash, and Mortgage Massacre - 27th Mar 20
Finding an Expert Car Accident Lawyer - 27th Mar 20
We Are Facing a Depression, Not a Recession - 26th Mar 20
US Housing Real Estate Market Concern - 26th Mar 20
Covid-19 Pandemic Affecting Bitcoin - 26th Mar 20
Italy Coronavirus Case Fataility Rate and Infections Trend Analysis - 26th Mar 20
Why Is Online Gambling Becoming More Popular? - 26th Mar 20
Dark Pools of Capital Profiting from Coronavirus Stock Markets CRASH! - 26th Mar 20
CoronaVirus Herd Immunity and Flattening the Curve - 25th Mar 20
Coronavirus Lesson #1 for Investors: Beware Predictions of Stock Market Bottoms - 25th Mar 20
CoronaVirus Stock Market Trend Implications - 25th Mar 20
Pandemonium in Precious Metals Market as Fear Gives Way to Command Economy - 25th Mar 20
Pandemics and Gold - 25th Mar 20
UK Coronavirus Hotspots - Cities with Highest Risks of Getting Infected - 25th Mar 20
WARNING US Coronavirus Infections and Deaths Going Ballistic! - 24th Mar 20
Coronavirus Crisis - Weeks Where Decades Happen - 24th Mar 20
Industry Trends: Online Casinos & Online Slots Game Market Analysis - 24th Mar 20
Five Amazingly High-Tech Products Just on the Market that You Should Check Out - 24th Mar 20
UK Coronavirus WARNING - Infections Trend Trajectory Worse than Italy - 24th Mar 20
Rick Rule: 'A Different Phrase for Stocks Bear Market Is Sale' - 24th Mar 20
Stock Market Minor Cycle Bounce - 24th Mar 20
Gold’s century - While stocks dominated headlines, gold quietly performed - 24th Mar 20
Big Tech Is Now On The Offensive Against The Coronavirus - 24th Mar 20
Socialism at Its Finest after Fed’s Bazooka Fails - 24th Mar 20
Dark Pools of Capital Profiting from Coronavirus Stock and Financial Markets CRASH! - 23rd Mar 20
Will Trump’s Free Cash Help the Economy and Gold Market? - 23rd Mar 20
Coronavirus Clarifies Priorities - 23rd Mar 20
Could the Coronavirus Cause the Next ‘Arab Spring’? - 23rd Mar 20
Concerned About The US Real Estate Market? Us Too! - 23rd Mar 20
Gold Stocks Peak Bleak? - 22nd Mar 20
UK Supermarkets Coronavirus Panic Buying, Empty Tesco Shelves, Stock Piling, Hoarding Preppers - 22nd Mar 20
US Coronavirus Infections and Deaths Going Ballistic as Government Start to Ramp Up Testing - 21st Mar 20
Your Investment Portfolio for the Next Decade—Fix It with the “Anti-Stock” - 21st Mar 20
CORONA HOAX: This Is Almost Completely Contrived and Here’s Proof - 21st Mar 20
Gold-Silver Ratio Tops 100; Silver Headed For Sub-$10 - 21st Mar 20
Coronavirus - Don’t Ask, Don’t Test - 21st Mar 20
Napag and Napag Trading Best Petroleum & Crude Oil Company - 21st Mar 20
UK Coronavirus Infections Trend Trajectory Worse than Italy - Government PANICs! Sterling Crashes! - 20th Mar 20
UK Critical Care Nurse Cries at Empty SuperMarket Shelves, Coronavirus Panic Buying Stockpiling - 20th Mar 20
Coronavirus Is Not an Emergency. It’s a War - 20th Mar 20
Why You Should Invest in the $5 Gold Coin - 20th Mar 20
Four Key Stock Market Questions To This Coronavirus Crisis Everyone is Asking - 20th Mar 20
Gold to Silver Ratio’s Breakout – Like a Hot Knife Through Butter - 20th Mar 20
The Coronavirus Contraction - Only Cooperation Can Defeat Impending Global Crisis - 20th Mar 20
Is This What Peak Market Fear Looks Like? - 20th Mar 20
Alessandro De Dorides - Business Consultant - 20th Mar 20
Why a Second Depression is Possible but Not Likely - 20th Mar 20

Market Oracle FREE Newsletter

Coronavirus-bear-market-2020-analysis

Stock Market Analysis: Baying for Blood

Stock-Markets / Financial Markets 2018 Feb 07, 2018 - 06:31 AM GMT

By: Abalgorithm

Stock-Markets

The wall street bear has woken up. The Dow Jones Industrial Average posted its largest-ever, single-day point decline and major indexes in the U.S., Europe and Asia gave up their gains for the year.The Dow briefly dropped nearly 1,600 points. Although it quickly pared losses, the blue-chip index closed down 1,175.21 points, or 4.6%, to 24345.75, its largest one-day percentage decline since August 2011.

At the time of writing the futures were further down to 2550 from the close of 2639. That is an important level of support. However we expect it to be tested.


SP500 Futures

SPX Index

Monday’s selling was broad-based, with all 11 sectors in the S&P 500 posting declines. Bank shares slid, sending the KBW Nasdaq Bank Index of large U.S. lenders down 4.9% and extending declines after posting its steepest loss of the year Friday. Declines in shares of oil-and-gas companies also dragged on major indexes. The S&P 500 energy sector shed 4.4%, while U.S. crude oil declined 2% to $64.15 a barrel. The fall was further painful for retail investors because enthusiasm for stocks led investors to pour a record $102 billion in January into mutual funds and exchange-traded funds that invest in equities globally. But cracks emerged last week when government bond yields jumped to four-year highs, raising fears among some investors of a faster-than-expected pickup in inflation. The selling that resulted was broad, sending everything from shares of energy companies to banks to technology giants lower.

Meanwhile, a measure of expected swings in the S&P 500, the Cboe Volatility Index, shot higher, jumping 117%—its largest one-day percentage gain ever.

VIX has hit a new high for the year at 37 after averaging under 12 for over 4 years. We had reported in our previous post about VIX headed higher. It had painted a floor and there was only one way for it go. UP!

We are abalgorithm has been alerting clients to the possibility of a severe correction. The data coming out of US has been weak as opposed to strong. Many main stream news outlets have been reporting data to be deceptively strong however the F-indicator at abalgorithm that tracks 100s of economic data points had shown significant weakness. Stock markets had diverged from the economy for over 3 months but stocks generally tend to the fundamentals with some delay.

Given the sharp fall in equities, we see strong correction back higher even possibly to 2700. But that may take a few weeks to materialize.

AAPL : Bull market bell weather

AAPL has broken below the 200 DMA. The uptrend of the last one year is over. However expect a reaction higher from broken trend line to challenge the previous highs.

Treasury Yield: Flight to safety

US10Y yield broke below 2.7 %. Money is flowing to safety out of risky assets. There is a flight to safety and hence we as trader need to align ourselves to the new normal.

F Indicator

US economy has been consistently trending down in terms of fundamental data releases. However stock market has been diverging from fundamentals and rose to record highs. Ultimately we believe fundamentals will impose itself.

GOLD

USDJPY downtrend intact

USDJPY is in bear market for over 5 months. USDJPY moves into bear trend only when markets are not bullish about equity risk over long term. The pair seems to be showing no interest in moving higher which leaves further downward continuation a possibility.Short on a break of 108 to 106.

BITCOIN

Bitcoin has corrected as expected. The correction has been severe as we noted in our previous analysis . Then prices were at 8300$. We were waiting for longs below $6000. We have reached near $6000 and we will be watching for lower time frame to see if bottoming happens. The fall in Bitcoin was in regard to regulation around the world however BITCOIN has become a tradeable asset as CBOE launches bitcoin futures. Therefore it will be just as regulated as any traded asset. So expect BITCOIN to form floors at important support 6000 before going long.

STOCK MARKET INTERNALS


The putcall ratio has risen to new yearly highs.


The number of stocks trading above 50 DMA has fallen to 690 stocks. The number was well over 1000 last week.


The number of stocks trading over long term uptrend lines of 200 DMA has fallen to 1300 from 1900 last week.

As observed the market internals have deteriorated significantly while the fundamental economy has finally started to impose on the stock markets. The market correction is simply a reflection of reality and correction of an overpriced market. The flight to safety with treasury prices rising and yields on 10 Year falling along with movement of capital to utility ETF suggests that smart capital does not expect long term bull market revive in the first 6 months of 2018. However we do expect some strong bounce in equity markets into MARCH which will be bounce of supports

About abalgorithm
abalgorithm.com operates an automated forex trading system which copies trades to its clients around the world. Our clients are able to reap the benefits of a class superior trading system along with industry leading research. We also host the F Indicator which is a fundamental indicator tracking all major economies.

Here is the latest equity snapshot of the trade copier service

The system has made +67.5% return since November launch averaging over +20% a month. It trades over 30 pairs including exotics like USDSEK. Trading system uses advanced concepts lie hedging and machine learning. All you need is a MT4 terminal and decent capital to trade. You can apply here: Contact US

About Us
abalgorithm.com is a quant based research and trading firm. We operate a high performance FX trade copier service which uses Machine Learning as its core. You can check the results here: TRADE COPIER 3 MONTHS REPORT: +53%
More performance reports
In addition, we operate a LIVE TRADE ROOM along with daily indepth research and manual trade calls. Clients and guests can have a lively discussion of the state of the world economy and trading opportunities.

To join our trade copier: Fill the form

About Abalgorithm.com
Abalgorithm operates an automated quant forex trade copier and a live trade room for clients who trade forex. We also provide daily research on equities, bonds, ETF, commodities. We are located at http://abalgorithm.com

© 2018 Copyright Abalgorithm - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 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

6 Critical Money Making Rules