Mixed, flat, stalled -- the only way to describe the U.S. equity markets. The strongest indices are $MID and $SML -- the S&P 400 mid caps and S&P 600 small caps. They are now both clearly in up trends (as we define an "up trend" in our system), but not yet strong, as the 50 CCI has yet to breach +100, though it has breached +50 on both. They have TC long set ups that triggered Friday, but just barely. Both have trend line resistance right overhead.
$SPX, $RUT, and $NDX are "muddled." None of them qualified for a change of trend to UP by the time TC shorts triggered. But in the recent rally off the March lows, all three did manage to trade above their 50 day MAs, pulling the 50 CCI above the zero line, holding for a few days. Yet the 50 CCI has not yet or barely breached even +50. The $RUT is the strongest of the three; the $NDX is the weakest. Our recent TC short in the $RUT was stopped out for a small profit last week, while our $NDX short is still with us. At the present time, the $RUT (barely) qualifies for a TC long. It has been finding support at the 100 day MA, and closing above its 50 day MA. But, trend line resistance right above.
$INDU and our "canary" sectors, $XBD (broker-dealers), $BKX (banks), and $HGX (housing), are clearly still in downtrends, as they did not even retake their 50 day MAs in the rally off the lows. All triggered TC shorts last week and are still on their short signals. Housing is the weakest, having rebreached its 200 day MA, and with the 50 CCI below -100. Banks and brokers are still holding above their 200 day MAs. $INDU never got close to breaching its 200 day MA in the sell off, and is the strongest of the four. Banks and brokers are also looking a bit "frisky," while housing, very oversold again, looks "dead in the water".
Money flow indicators don't look bad at all for most of the indices, except the banks, brokers and housing. (In fact, money flow is very strong in most of the indices.) The problems with housing are by now well known. There is also a great deal of concern by market participants that the large brokers and banks will see some fall out from the sub-prime time bomb that is hitting housing. Housing has been weak for years, as the $HGX topped out in 2005, and the big brokers, $XBD, topped out in January of this year.
So yes, all is well with the economy and the markets, except for housing, banks and the big Wall Street firms. That is like a doctor telling his patient that he is in great health except for the large spear sticking out of his chest!
$SPX, $RUT, and $NDX are "muddled." None of them qualified for a change of trend to UP by the time TC shorts triggered. But in the recent rally off the March lows, all three did manage to trade above their 50 day MAs, pulling the 50 CCI above the zero line, holding for a few days. Yet the 50 CCI has not yet or barely breached even +50. The $RUT is the strongest of the three; the $NDX is the weakest. Our recent TC short in the $RUT was stopped out for a small profit last week, while our $NDX short is still with us. At the present time, the $RUT (barely) qualifies for a TC long. It has been finding support at the 100 day MA, and closing above its 50 day MA. But, trend line resistance right above.
$INDU and our "canary" sectors, $XBD (broker-dealers), $BKX (banks), and $HGX (housing), are clearly still in downtrends, as they did not even retake their 50 day MAs in the rally off the lows. All triggered TC shorts last week and are still on their short signals. Housing is the weakest, having rebreached its 200 day MA, and with the 50 CCI below -100. Banks and brokers are still holding above their 200 day MAs. $INDU never got close to breaching its 200 day MA in the sell off, and is the strongest of the four. Banks and brokers are also looking a bit "frisky," while housing, very oversold again, looks "dead in the water".
Money flow indicators don't look bad at all for most of the indices, except the banks, brokers and housing. (In fact, money flow is very strong in most of the indices.) The problems with housing are by now well known. There is also a great deal of concern by market participants that the large brokers and banks will see some fall out from the sub-prime time bomb that is hitting housing. Housing has been weak for years, as the $HGX topped out in 2005, and the big brokers, $XBD, topped out in January of this year.
So yes, all is well with the economy and the markets, except for housing, banks and the big Wall Street firms. That is like a doctor telling his patient that he is in great health except for the large spear sticking out of his chest!
