Friday, February 14, 2014

Looking For a Top In the U.S. Stocks

Yesterday the Nasdaq 100 Index made another high at this bull market cycle (which started in March 2009 - yes, it has been nearly five year old bull!). But looking at the advancing and declining issues this high does not look impressive at all:

                                                                                source: Simple Digressions

As the table shows, although we have seen the new high, the number of the advancing issues is still lower than at the previous two peaks (the same with the difference between new high and new low). The only impressive thing is a volume, which is quite high.
Now, let us look at the chart showing the developing Nasdaq 100's top in 2007:


And then this same index in 2014:


Well, as for me, some similarities are noticeable. I am very curious what the on-coming sessions show  - with the main question being "Is is a developing top ?".

And the last - below is the chart of NYSE Bullish Precentage - presently it is not reacting to the rally in U.S. stocks. Simply put - the rally is not supported by the optimism (as previously). This is not a good sign for the bulls.

                                                  source: Investor Intelligence and Simple Digressions

Tuesday, February 4, 2014

VIX Indicates a Search for a Short Term Bottom

Yesterday's session on Wall Street set a record on VIX volume. Having in mind that VIX is a risk measure, I can conclude we saw a Fear yesterday.

                                                         source: and CBOE

Of 2,382,752 contracts which changed hands yesterday, 1,850,206 were call contracts. It means that a lot of traders were hedging their positions against further U.S. stock market losses.
In the past, such a heavy trading was a good indicator of the short term bottom in the S&P 500. If this story repeats again, we should see a bottom within a few days.

Monday, February 3, 2014

Transportation and Industrial Averages - No Changes

Do you remember the chart of the month in my post published at the end of November 2013 ? If not,   here is the link.
But let us look at it again. Has anything changed ?


I do not think so. As you see this is still intact.

Saturday, February 1, 2014

Gold and Silver - Still In Down-Trends

In my last piece on precious metals ( here ) I was looking for a bottom in the sector. Well, while some tough speculators are probably betting heavily on this bottom, this is still an open matter.
Let us look at the chart below:


Both silver and gold are still in their technical down-trends - which is still an argument for the metals sellers.
On the other hand, the big argument for the goldbugs is that both metals are above their bottoms recorded at the end of June 2013.