The “Fear/Greed Sentiment Index: What Emotion is Driving the Market Now?” has a current reading of “51” which indicates that we are quite possibly traversing the range towards an “Extreme Fear” buy signal. With the current strength in the markets, I would only expect this indicator to briefly touch the under “30” reading. It should then explode higher.
STOCK MARKET STRATEGY FOR FEBRUARY 8, 2020: The major indices in the stock market (Dow, S&P, Nasdaq) all hit historic highs on January 17, 2020. A sharp decline followed with a bottom on January 31st. Then a rally ensued with new highs claimed on Thursday February 6. The time period between the two highs 14 trading sessions. This pattern could qualify as a classic “Joe Granville Top” with February 6th being the external top of the Bull Market and the “Obvious Cover Story” being the end of the Impeachment Trial and a seemingly clear path to a Trump Election victory.
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market may have hit its high for the Bull Market on Thursday February 6th with the “Obvious Good News Cover Story,” euphoria in the markets, and narrow new highs & crazy action in glamour tech stocks like Tesla. This would be a good time to “take the money and run” or lighten up on overextended, overvalued positions. Note: This most recent new all-time high was quietly achieved without any mention of it being a final top of the market. The bears appear to have given up predicting the final top. We shall see…..
STOCK MARKET STRATEGY FOR JANUARY 5, 2020: The major indices in the stock market (Dow, S&P, Nasdaq) all hit historic highs on January 2, 2020. Given the current geopolitical backdrop, that day could prove to be the classic “internal high” according to the late stock market technician, Joseph E. Granville. What typically follows is a broad decline and then a retest of the January 2nd highs. In theory, the DJIA would close at a new high (“external high”) that is not confirmed by the majority of other indicators and indices. The time frame was usually 2-5 weeks in the previous era of stock market trading history.
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market may be forming a classic “Joe Granville Top.” This formation takes about 2-5 weeks to form and will give longs one last chance to exit the market before the next significant decline begins. Of course, this is theory but history has a funny way to repeating itself for those who are unaware or unbalanced in their thinking towards technical analysis.
The “Fear/Greed Sentiment Index: What Emotion is Driving the Market Now?” has a current reading of “91” which indicates that we are in the area of a top. Keep in mind that more often than not, the final top or ideal sell point occurs when this indicator is above a reading of “90.” While this does not mean it is a time to short the market, it does mean that it is not the time to buy.
STOCK MARKET STRATEGY FOR NOVEMBER 28, 2019: The major indices in the stock market (Dow, S&P, Nasdaq) all hits consecutive historic highs for three days in a row on declining volume. A similar situation happened in reverse back in August of 1982 when the general market quietly exhausted all selling at its final inflation-adjusted all-time low. Could this be the ultimate top? Have the last short-sellers finally thrown in the towel? Isn’t it a coincidence that this is happening on a holiday, too?
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market is quietly making new all-time highs as complacency has set in on a seemingly never-ending relentless advance. But my senses tell me that the top is close at hand and a move to the sidelines is most likely the smartest move to make right now.
STOCK MARKET STRATEGY FOR OCTOBER 26, 2019: The stock market has been rallying for 4 weeks now in a narrow channel suggesting a change of direction soon. With the internal indicators having reached “overbought” territory during this past week, I’d expect a move down the next few days with a setup for one last run to new highs before the late Fall volatility returns to finish the year.
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market has already made an internal top with the market likely to dip for a few days before going to new highs during the second week on November. Be ready for a quick dip buy point this coming week for a ride up.
The “Fear/Greed Sentiment Index: What Emotion is Driving the Market Now?” has a current reading of “52” which is not indicating a nearby top or bottom. Keep in mind that more often than not, the final bottom or ideal buy point occurs when this indicator is below a reading of “10.”
STOCK MARKET STRATEGY FOR SEPTEMBER 7, 2019: The stock market just broke above its most recent tight trading range on optimist news about a possible China trade deal. But the internal indicators suggest that the market is overbought and a correction is due with a possible target low around September 11th – the anniversary of 9/11/2001. This may be a good time to lighten up on positions over the short-term with a decent chance of a hard spike down in the coming week.
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market has made a significant rally on obvious good news about a China trade deal. But the overbought condition makes the short-term market one that could be bumpy and volatile. This may be an opportune time to take some profits and be ready for better odds over the shorter term.
STOCK MARKET STRATEGY FOR AUGUST 31, 2019: The stock market is currently in a tight trading range with its 4th trip up to the top of it on Friday. With the internal indicators in neutral territory across the board, I’d expect the trading range to continue without a breakout to either the top or bottom in the next few weeks. Don’t be surprised if the rally continues for a few more days on hopes for a trade deal with China only to find disappointment and threats again by next weekend…..and another drop to test the bottom of the range.
Key underlying short-term timing indicators show the following:
***********
THE BOTTOM LINE: The stock market is in the middle of its trading range in terms of the internal indicators. It appears that the market will continue upwards for a few more days before taking another trip to revisit its most recent bottom.
The “Fear/Greed Sentiment Index: What Emotion is Driving the Market Now?” has a current reading of “22” which is the first step to getting a tradable bottom. But keep in mind that more often than not, the final bottom or ideal buy point occurs when this indicator is below a reading of “10.”