Last Short Term Cycle Update for 2015

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The following was posted on December 14,2015
Today's comments are in Blue

Short term details:(every date is +/-)

The short term and intermediate term cycles are suggesting a bottom sometime in late November to early December.   These dates have now extended slightly into December.   As of today this bottoming process has extended to at least last Friday Dec 11th.     The low came in on Monday Dec 14th and this was one of the dates given to watch for a possible turn in the stock market.

 

Short term cycles suggest some volatility from Dec 5-7th to Dec 24th.  A high came in of Dec 7th and then catapulted down into last Friday Dec 11th  The low came in on Monday Dec 14th and this was one of the dates given to watch for a possible turn in the stock market in the following paragraph.  

The cycles suggest several dates to watch for possible turns.  

They are Dec 9, 11, 13, 14, 16-19 and the 24th.    A lot of energy and volatility came in on Dec 9th and Dec 11th and both were significant.  Dec 14th was significant as well.  Dec 16-19 could be a high and Dec 24th a low as suggested by the short term cycles.   This was a direct hit as the high did come in on Dec 17th in the middle of the forecast range of Dec 16-19.   So far, the Dec 24th +/- low was a little late as the market did bottom on Monday Dec 21st.  But if you follow this Blog you would have read that there was a shift in the SPY Buying Pressure and that indicator called the market turn.

 

These dates are always +/- 

From Dec 24th the cycles have an upward bias into December 29th to January 7-14   

 

More on both the short term and intermediate term cycles as we get through some of these dates...

 

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Past performance is not indicative of future results

chart: SPY shift in Buying Pressure

This is a chart of the SPY and Buying Pressure.   The SPY recently had been making lower lows, BUT, the Buying Pressure did not follow the same pattern.  The Buying Pressure has now made a higher low. 
If this pattern continues then it will fall in line with the short term cycles suggesting a low this week and a move up into late December and or early January.

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chart: SPY gap open was sold into

Courtesy of TradeStation

This is a 4min chart of the SPY.  The white box highlights the gap open.  The red line histogram at the bottom is the OBV.  As the market gapped up the OBV displayed red lines below zero indicating that the open was being sold into.   If the gap up open was being bought the OBV histogram would have had green lines above zero.

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Past performance is not indicative of future results

chart: % of DJIA stocks above 10DMA

Courtesy of IndexIndicators.com

Note where we are again as highlighted in yellow.
Some kind of a bounce will try to work off this oversold condition.   The short term cycles are suggesting a low this week and then a bis up into Dec 29th to Jan 14th time frame.  As we get closer to this period more information will hopefully become available.

The short term cycles suggesting a possible move up into January would be concurrent with the intermediate term cycles suggesting a high sometime in January.  If these two cycles do in fact turn out to be working in conjunction with one another and the stock market does move higher into the January time frame then there would be more evidence that a high is forming and a low could develop a few months later around mid year +/-.

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Past performance is not indicative of future results

chart: DJIA 1929 - Do the signs look familiar ?

DJIA 1929 - Courtesy of Worden Bros

1) Blue vertical arrow - a red monthly price bar broke the fuschia MA
2) Red vertical arrows - subsequent to the above #1, three blue monthly price bars developed
3) Yellow circle - MACD sell signal
4) Blue horizontal arrow - Histogram below zero and below it's blue MA
After the third blue price bar in #1, the stock market continued lower into the July 1932 bottom

Do the signs on this chart of the 1929 DJIA look familiar?
If you saw JustSignals last post, it should.
If you didn't, here is the link:
 http://justsignals.blogspot.com/2015/12/charts-djia-monthly-will-history-repeat.html

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Past performance is not indicative of future results

charts: DJIA monthly - will history repeat ?

DJIA 2000-2001

Courtesy of Worden Bros

After much staring at the DJIA monthly charts the following repetitive items came to light at the 2000 top, the 2007 top and again at the, so far, 2015 top.

1) Blue vertical arrow - a red monthly price bar broke the fuschia MA
2) Red vertical arrows - subsequent to the above #1, two blue monthly price bars developed
3) Yellow circle - MACD sell signal
4) Blue horizontal arrow - Histogram below zero and below it's blue MA
After the second blue price bar in #1, the stock market continued lower into the October 2002 bottom

DJIA 2007-2008

Courtesy of Worden Bros

1) Blue vertical arrow - a red monthly price bar broke the fuschia MA
2) Red vertical arrows - subsequent to the above #1, two blue monthly price bars developed
3) Yellow circle - MACD sell signal
4) Blue horizontal arrow - Histogram below zero and below it's blue MA
After the second blue price bar in #1, the stock market continued lower into the March 2009 bottom
DJIA 2015

Courtesy of Worden Bros

1) Blue vertical arrow - a red monthly price bar broke the fuschia MA
2) Red vertical arrows - subsequent to the above #1, two blue monthly price bars developed
3) Yellow circle - MACD sell signal
4) Blue horizontal arrow - Histogram below zero and below it's blue MA
After the second blue price bar in #1, the stock market ?????????

The question here is Will History Repeat Itself Again ?

Post from Sept 4,2015    "Major Signal"
Link     http://justsignals.blogspot.com/2015/09/charts-major-signal.html

Post from Nov 16,2015   "Major Sell Signal Update"

Link     http://justsignals.blogspot.com/2015/11/major-sell-signal-update.html


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Past performance is not indicative of future results

chart: Fed Rate Hikes = ?

The following is an excerpt from realinvestmentadvice.com
By Lance Roberts

Looking back through history, the evidence is quite compelling that from the time the first rate hike is induced into the system, it has started the countdown to the next recession. However, the timing between the first rate hike and the next recession is dependent on the level of economic growth at that time. As I stated earlier this week:

“When looking at historical time frames, one must not look at averages of all rate hikes but rather what happened when a rate hiking campaign began from similar economic growth levels. Looking back in history we can only identify TWO previous times when the Fed began tightening monetary policy when economic growth rates were at 2% or less.
(There is a vast difference in timing for the economy to slide into recession from 6%, 4%, and 2% annual growth rates.)”

Courtesy of realinvestmentadvice.com

“With economic growth currently running at THE LOWEST average growth rate in American history, the time frame between the first rate and next recession will not be long.”

Given the reality that increases in interest rates is a monetary policy action that by its nature slows economic growth and quells inflation by raising borrowing costs, the only real issue is the timing.
As Sam Zell noted yesterday:

“I think this interest rate hike is too late, this economy is closer to falling over than it is to going up. I think there’s a high probability that we’re looking at a recession in the next twelve months.”

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Past performance is not indicative of future results

chart: SPY Buying Pressure

This is the SPY vs Buying Pressure. 
This chart started to develop a recent pattern very similar to the pattern formed from December 2014-January 2015. 
"History doesn't repeat itself, but it does rhyme" - Mark Twain
The two red horizontal arrows indicate a double top pattern. 
The green vertical arrow shows where the SPY and the Buying Pressure both bottomed on the same day subsequent to the double tops.
The red trend line with a yellow circle at the bottom indicates when the down trend line was broken to the upside.
The blue arrow shows where the green arrow bottom was tested.  The second blue arrow on the right side of the chart shows where another test of the bottom may occur if this entire pattern is going to repeat again.

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Past performance is not indicative of future results

After the Fed Rate Hike

The cycles suggested a high in the Dec 16-19 time period from the Dec 14th low and so far, that is what we got.


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Past performance is not indicative of future results

chart: SPY 4min chart nailed it

Yesterday the SPY 4min chart was posted and there were a few buy and sell signals on that chart.  The last signal was a buy signal in the afternoon.  That signal caught the large gap up opening.  THe DJIA Futures at the time this is being written is +159.0

See yesterdays chart at the following link
http://stks.co/s3KAs

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Past performance is not indicative of future results

RYNVX increased in Market Cap

Last posted on December 1,2015
Updates in BLUE - RYNVX inched closer to an extreme reading

RYFXX - Rydex US Government Money Market
RYNVX - Rydex Nova Fund Investor Class (Long Fund)
RYURX -  Rydex Inverse S&P 500® Strategy Fund Investor Class (Inverse Fund)

RYFXX   3-10-09   $1,367Mil   3-10-15   $655Mil   9-9-15   $1,434Mil
                                                                                   9-14-15  $1,451Mil    
                                                                                 10-26-15    $862Mil
RYNVX  3-11-09   $21.96 Mil  5-14-15    $177Mil   9-4-15       $53Mil 
                                                                                    9-14-15      $52Mil
                                                                                  10-26-15    $140Mil
                                                                                  11/27/15     $182Mil
                                                                                  12/10/15     $187.44
RYURX   3-9-09        $353Mil   5-4-15   $58.34Mil   9-9-15    $148Mil
                                                                                    9-14-15   $172Mil
                                                                                  10-26-15   $117Mil

Note that in March 2015 and in May 2015 the stock market made highs.  The RYNVX is now at an extreme.  It is at a recovery extreme high in market cap at $187.44Mil. since March 11,2009.

This displays the complacency in the market...

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Past performance is not indicative of future results

STIX Indicator Update

An indicator that is not in most platforms is STIX

Definition of STIX

By Investopedia
A short-term trading oscillator that compares the amount of volume flowing into advancing and declining stocks. The STIX oscillates around the 50 level, with values over 50 generated when advancers outnumber decliners, and values less than 50 resulting when advancers are less than decliners. The trading range for the STIX is generally between 42 and 58, with levels below 42 indicating extremely oversold conditions, and levels above 58 denoting extremely overbought conditions.

Rules:
1- If STIX gets as low as 45, the market is almost always a buy, except in a raging bear market.
2- The market is fairly overbought if STIX rises to 56; and except in a new bull market , it's wise to sell if STIX should go over 58.
NOTE - Low of 28 & High of  69 were both made in 1932.

At the close yesterday the STIX was 41.1 at 202.90 in the SPY

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Past performance is not indicative of future results

chart: TNA 60min chart signals

Courtesy of TradeStation

Indicator signals are highlighted in white on this chart.  For some shorter term traders you can see other opportunities in between the longer signals.

Have a plan to enter and exit the market before you make a trade.  It is not wise to trade based on emotions.  Reward to risk ratio is common at 3:1.  Trade based on your risk tolerance and use money management wisely.  If you are new to trading there are many trading rules that you can find online.  Find them and use the ones that are right for you.

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Past performance is not indicative of future results

chart: SPY 4min chart signals

Courtesy of TradeStaion

Indicator signals are highlighted in white on this chart.  Have a plan to enter and exit the market before you make a trade.  It is not wise to trade based on emotions.  Reward to risk ratio is common at 3:1.  Trade based on your risk tolerance and use money management wisely.  If you are new to trading there are many trading rules that you can find online.  Find them and use the ones that are right for you.

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Past performance is not indicative of future results

charts: By Chris Carolan & a ST cycle update

Courtesy of Chris Carolan

Courtesy of Chris Carolan

What is interesting is that both of the charts above indicate a bottom around Dec 24th.  One chart is based on the tidal waves and the other lunar events.  But as we know tidal waves are a function of the moon's gravitational pull.  So they are probably somewhat related.

Another interesting piece is that the Short Term Cycle Update posted on Nov 30,2015 also indicated volatility until Dec 24, 2015.  Below is another update

The following was posted on November 30,2015
Today's comments are in Blue

Short term details:(every date is +/-)

Dec 5th low  The low came a bit early on Dec 3rd

The short term and intermediate term cycles are suggesting a bottom sometime in late November to early December.   These dates have now extended slightly into December.   As of today this bottoming process has extended to at least last Friday Dec 11th.

 

Short term cycles suggest some volatility from Dec 5-7th to Dec 24th.  A high came in of Dec 7th and then catapulted down into last Friday Dec 11th

The cycles suggest several dates to watch for possible turns.  

They are Dec 9, 11, 13, 14, 16-19 and the 24th.    A lot of energy and volatility came in on Dec 9th and Dec 11th and both were significant.    Dec 16-19 could be a high and Dec 24th a low as suggested by the short term cycles and in Chris Carolan's charts at the top of this page.

 

Of course these dates are +/-.  

From Dec 24th the cycles have an upward bias into January 7-14.

 

More on both the short term and intermediate term cycles as we get through some of these dates...

 

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Past performance is not indicative of future results

chart: SPX & RYDEX Ratios

Courtesy of StockCharts.com

Look at the purple oval highlights on this chart is self explanatory.

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Past performance is not indicative of future results

chart: 10Day Summation of Highs-Lows

For the first time in a while the 10Day Summation of Highs - Lows has made a lower low.
Up till now the chart was in an up trend with higher highs and higher lows.

This along with the previous post of weaker Buying Pressure may be evidence of a stock market that is trying to go lower.  How low though is not known.

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Past performance is not indicative of future results

chart: SPY's Weak Buying Pressure Continues

Today the Buying Pressure chart made a new low of 6.  It broke the June 2015 low of 7.  This chart has been showing a decline in buying pressure since it made a top with the SPY in early November 2015.

Although the stock market is nearing an OS condition, this chart indicates market weakness until some positive divergence that may be needed to indicate a move up in the market.

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Past performance is not indicative of future results

chart: SPY Buying Pressure

The top window is the SPY.  The bottom window is Buying Pressure.  As you can see the buying pressure made a top with the SPY in early November.  When the stock market pulled backed into mid month and then rallied, the buying pressure continued to fall.  In fact, just yat yesterdays close, the buying pressure broke below its September low and is currently sitting at its June level.  This chart has a history of setting up positive and negative divergences and tends to lead the stock market.

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Past performance is not indicative of future results

chart: DIA update

Courtesy of Chaikin Analytics

Note the vertical line at the November mod month low.   While the DIA (DJIA) rallied from that low, the CMF did not rise with that rally which is typical during a rally.  Also the RS faded over that same time period.  This is not what you would like to see during a robust stock market rally.

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Past performance is not indicative of future results

chart: Find of the Day - SNX

Courtesy of Chaikin Analytics

Mkt Cap $3.7Bil
Trend - strong
Industry - strong
MA - above Chaikin's proprietary MA (tan line)
CMF - strong
OB/OS - in OS area
RS - strong
Chaikin PG - very bullish

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Past performance is not indicative of future results

chart: Market Buying Pressure

Here we have the SPY in the top window and Buying Pressure in the bottom window.  The long white lines show the long divergences between the two.  The green trend line displays a bullish bias in the SPY price chart and the red line displays the lack of conviction (lack of buying pressure) in the SPY price rise.

In the past, buying pressure tops before price and bottoms before price. So in many cases the buying pressure has been a leading indicator of price.

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Past performance is not indicative of future results

RYNVX recovery in Market Cap

Last posted on October 26,2015
Updates in BLUE - RYNVX inched closer to its extreme readings

RYFXX - Rydex US Government Money Market
RYNVX - Rydex Nova Fund Investor Class (Long Fund)
RYURX -  Rydex Inverse S&P 500® Strategy Fund Investor Class (Inverse Fund)

RYFXX   3-10-09   $1,367Mil   3-10-15   $655Mil   9-9-15   $1,434Mil
                                                                                   9-14-15  $1,451Mil    
                                                                                 10-26-15    $862Mil  -$589Mil
RYNVX  3-11-09   $21.96 Mil  5-14-15    $177Mil   9-4-15       $53Mil 
                                                                                    9-14-15      $52Mil
                                                                                  10-26-15    $140Mil +$88Mil
                                                                                  11/27/15     $182Mil +$42Mil 
RYURX   3-9-09        $353Mil   5-4-15   $58.34Mil   9-9-15    $148Mil
                                                                                    9-14-15   $172Mil
                                                                                  10-26-15   $117Mil  -$55Mil

Note that in March 2015 and in May 2015 the stock market made highs.  The RYNVX is now at an extreme.  It is at a recovery extreme high in market cap at $182Mil. since March 2009.

This displays more complacency in the market...

Keep following JustSignals using Twitter, @StockTwits or Follow By Email. 
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This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results