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The percentage of Stocks in a Bullish Upswing for the Major Indexes
3% of the Dow Jones is on an Upswing
4% of the S&P 100 is on an Upswing
3% of the Nasdaq 100 is on an Upswing
Notice above the Percentage of Stocks in an Upswing is at very low levels. These are some of the lowest percentages that we will see. This really only happens when the market has fallen apart
Also, remember when the Percentage gets this low. That means it has gotten to extreme levels and the market can bounce from here. It may be a short-term bounce or something more, but a bounce can happen at these extreme levels
The Major Indexes had a really terrible week and an even worst day on Friday.
The Major Indexes basically collapsed. The reason for the collapse to me is not that important, what is important is the fact that we saw the Weakness in the Market way before the collapse happened and the NEWS REPORTS.
The Charts showed weakness weeks before this collapse. If you go back and look at our previous post you will see we were cautious all the time. Also, you will see some of the clues the charts were giving us
I hope no one lost money, and hopefully, we all earned a check this week.
The Market is now in CORRECTION. We must now look for a 1st Day Rally Attempt and then the Follow Through Day before we start really getting back to buying stocks.
The Major Indexes broke through the Support Levels, Trendlines, and Long-Term Key Moving Averages on Very Heavy Volume. This was an Extremely Bearish week
The Market Breadth is also very weak and we warned that if the breadth didn't get better the market will fall apart. Well the Breadth didn't get better and the market Fell Apart
The Adv.-Decl, Issues Diff Green Line is below the Zero Line and pointing downward also the Red Line is crossing below the Zero Line.
If the Red Line stays below the Zero Line along with the others lines. This will be a sign of extreme Bearishness and the Market will be in trouble. See Below:
S&P 500 Advance-Decline Diff Chart
Nasdaq Advance-Decline Diff Chart
Notice the percentage of stocks above there 20 Day Moving Average, It's starting to reach Extremely low Levels. The Market likely bounce off these levels in the upcoming weeks. See below
S&P 500 percentage of Stocks Above their 20-Day Moving Average
Nasdaq percentage of Stocks Above their 20-Day Moving Average
A picture is worth a Thousand Words
Charts updated as of Friday 3-10-2023
Below is a Daily Structural Chart of the Dow Jones Index.
Notice The Index Broke Below the Red Horozantial Line @ 32,906.51 and then broke the upward trending Trendline.
The Price then broke the Yellow Line @ 35,504.04, Then Price Broke through the Yellow Line @ 32,006.13.
The Price is now below the 32,006.13 level and closed just above the Internal Downward Trending Trendline and the 31,727.05 Horizontal Support Level.
If the Price break below and close below the Downward Trending Trendline and the 31,727.05 Horizontal Support Level. We will look for prices to move to 31,511.46 as the next possible support level
Look at the Daily Chart Below of the Dow Jones Index with Key Moving Averages. Notice that the Dow Jones has now broken below all the Key Moving Averages and now below the 200-Day Moving Average.
This was happening at the same time we were having more distribution than accumulation. Not good price action.
We have to include the Weekly Charts now for a clearer picture of what's going on
Look at the Weekly Chart Below of the Dow Jones Index with Key Moving Averages. Notice that we broke below and closed below our key Long-Term Key Moving Averages.
The price also got below the 40 Week and 150-Week MA.
If the Price cannot get back above the 40-Week and150-Week MA then the next Stop is probably the 200-Week MA
We will stay really bearish on this index until the price gets back above the 40-Week and 150-Week MA. Also, Notice that we had a Bearish Outside Week with Above Average Volume. This is very Bearish
Below is a Daily Structural Chart of the S&P 500 Index. Notice that the Price action fell below the Art Cashin Line (Magenta Line) @ 3925.00 and my Yellow Horozantial Line @ 3900.00
Also, the price broke below and closed below the Downward Trending Trendline (which was that trendline we were watching as possible resistance in 2022)
We are now inside of a Heavy Consolidation Area from Mid December 2022 (the Blue shaded area) Prices could find some support here and chop around for a while, but if the Price breaks below this consolidation and close below it that is Very Bearish
We are looking at the 3810.37 Horizontal Level (Red Line) and the 3800.00 Horizontal Line (magenta line) as the next possible support also notice that these lines are inside the blue consolidation area
Look at the Daily Chart Below of the S&P 500 Index with Key Moving Averages. Notice that the price broke below and closed below the 200-Day MA with heavy volume distribution.
If prices remain below the 200-Day MA we will remain bearish on this index
Look at the Weekly Chart Below of the S&P500 Index with Key Moving Averages. Notice that the price action has just broke below the 40-Week MA with heavy volume. Also, the week was a Bearish Outside Week. This is very bearish weekly action. The next area of possible resistance on this chart is the 200-Week MA
If prices remain below the 200-Week MA we will remain bearish on this index
Below is a Daily Structural Chart of the Nasdaq Index. Notice that the Price Action has traded down to the Uptrending Internal Tredline almost to the PENNY and bounced.
If the price breaks below the Uptrending Internal Tredline and the Yellow Horozantial support level @ 11,035.69 and the Red Horozantial support level @ 11,000.00 then prices could possibly move to the Weekly Red Horozantial level @ 10,850.01
Daily Chart Below of the Nasdaq Index with Key Moving Averages. Notice that the price action has broke below and closed below all the Key MA's. The price action tried to get back above the 50-Day MA (Red line) but got rejected and moved lower with very heavy volume. This is bearish price action
If prices remain below the 50-Day MA we will remain bearish on this index
Look at the Weekly Chart Below of the Nasdaq Index with Key Moving Averages. Notice that the Price action has broken below all the Key Moving Averages with heavy volume. This was also a bearish Outside Week with Heavy Volume.
If prices remain below these Key MA's we will remain bearish on this Index
All the Charts above including the Breadth Charts are showing a Bearish picture of the Major Market Indexes, because of this we will remain bearish on the Major Market Indexes and Individual stocks.
Remember that 75% of all stocks will follow the Major Market Indexes, and right now that looks like DOWN
What do we need to see before changing our view and becoming more bullish, and really buying stocks again?
Well for starters we will need to see the following:
1- Major Market Swing Signal turn Bullish
2- The Green Line on the Advance-Decline Diff. chart getting back above the Zero Line
3- 1st Day Rally Attempt
4- % of stocks above their 20-Day MA above 50%
5- Follow Through Day
Economic Reports
This Week has some Key Economic News that can really move the markets. There could be some wild price swings this week as the News comes out.
Tuesday and Wednesday are key Inflation Numbers, Retail Sales Numbers, and Inventory Numbers
Also, be aware of the possibility of more banks getting in trouble and failing
This can change quickly this week. Be Careful
Monday, March 13, 2023,
Nothing Important
Tuesday, March 14, 2023,
@ 7:30 or 8:30 am Core CPI (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Core CPI (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Core CPI Index (Feb) (This could be a market mover)
@ 7:30 or 8:30 am CPI (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am CPI (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Real Earnings (MoM) (Feb) (This could be a market mover)
Wednesday, March 15, 2023
@ 7:30 or 8:30 am Core PPI (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Core PPI (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am PPI ex. Food/Energy/Transport (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am PPI (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am PPI (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am PPI ex. Food/Energy/Transport (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Core Retail Sales (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Retail Sales (YoY) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Retail Sales (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Retail Inventories Ex Auto (Jan) (This could be a market mover)
@ 9:00 am Business Inventories (MoM) (Jan) Retail Sales Ex Gas/Autos (MoM) (Feb) (This could be a market mover)
@ 9:30 am Crude Oil Inventories (This could be a market mover)
@ 9:30 am Cushing Crude Oil Inventories (This could be a market mover)
Thursday, March 16, 2023
@ 7:30 or 8:30 am Building Permits (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Building Permits (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Housing Starts (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Housing Starts (MoM) (Feb) (This could be a market mover)
@ 7:30 or 8:30 am Continuing Jobless Claims (This could be a market mover)
@ 7:30 or 8:30 am Initial Jobless Claims (This could be a market mover)
@ 7:30 or 8:30 am Jobless Claims 4-Week Avg (This could be a market mover)
@ 7:30 or 8:30 am Philadelphia Fed Manufacturing Index (Mar) (This could be a market mover)
Friday, March 17, 2023
@ 8:30 am Industrial Production (YoY) (Feb) (This could be a market mover)
@ 8:30 am Industrial Production (MoM) (Feb) (This could be a market mover)
@ 8:30 am Manufacturing Production (MoM) (Feb) (This could be a market mover)
@ 8:30 am Michigan Consumer Expectations (Mar) (This could be a market mover)
@ 8:30 am Michigan Consumer Sentiment (Mar) (This could be a market mover)
@ 8:30 am Michigan Current Conditions (Mar) (This could be a market mover)
@ 8:30 am Michigan Inflation Expectations (Mar)(This could be a market mover)
@10:00 am US Leading Index (MoM) (Feb)
@ 3:30 am CFTC S&P 500 speculative net positions
The BEARS have taken control of the Market, and the Market is now in CORRECTION. We are now on the lookout for a 1st-day Rally Attempt and New Follow Through Day.
Things can change quickly this week. Be Careful
Thank You
Rod
BTA
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