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Today's Market Comments:
The major stock indices rose modestly Thursday, April 8th, on the lowest volume of the year. Rising prices on weakening volume is typical of topping action. The S&P 500 has formed a new Bearish divergence with its Demand Power measure, suggesting a top is approaching.
On page 36 we show that the Dow Industrials are finishing a Rising Bearish Wedge termination topping pattern from the end of January 2021, with the final subwave c-up of the final wave e-up in process to complete this pattern. There could be a bit more upside to finish the count, however this pattern is typically something seen at tops. The clarity of the pattern is what is drawn right out of the text book. It consists of converging upper and lower rising boundary lines, with five waves, each wave having three subwaves. Textbook.
On page 37 we show two possible short-term counts for the Industrials from the March lows. Both are expecting another short-term pop before the top arrives.
This pattern is telling us the bubble mania rally is approaching its end. Could more money be made playing the remaining rise for this trend? Sure. However, it is a topping pattern evident here, and is going to reverse in a big way. The end of this rally period is not far off.
The S&P 500 is also completing the final rally leg for a termination topping pattern, shown in the chart on page 40. Same for the NASDAQ 100 (page 42), with an ending pattern final rally leg in process. Same for the Russell 2000 (IWM) shown in chart on page 44.
Our small cap Russell 2000 Purchasing Power Indicator remains on a Buy signal Thursday. Our Blue Chip short-term three-component key trend-finder indicator remains on a Neutral signal. Our three-component NASDAQ 100 key trend-finder indicator remains on a Buy signal.
Our HUI key trend-finder indicators remain on a Buy signal as both the HUI Purchasing Power Indicator and the HUI 30 day Stochastic are on Buys. As Gold typically follows this indicator, this Buy signal could be suggesting a bottom has arrived in Precious Metals and Mining stocks.
Our intermediate term Secondary Trend Indicator remains on a Buy signal. It rose 6 points Thursday (out of a possible 9 points), to positive 21. It needs to fall below negative - 5 for a new Sell signal.
There is a Hindenburg Omen potential stock market crash signal on the clock. It is a two-observation signal so far. The probability of a crash would increase if we see five H.O. observations within a 36-day period. We posted an article on the H.O. in our Guest Articles section of our website at www.technicalindicatorindex.com
Over the past year, The VIX has formed a five wave Declining Wedge pattern, with a support shelf around 20ish. The VIX recently spiked above 35 to conclude the fourth wave (D) up and is now traveling in the fifth wave, (E ) down. It is dropped below the support shelf. Once (E ) bottoms, the VIX will be poised to rise sharply, which would coincide with a strong stock market sell-off.
Gold, Silver and Mining stocks rose moderately Thursday. It is possible that with the new HUI Buy signals, that Gold has bottomed, and is about to rise out of the corrective descending expanding triangle pattern we show on page 48. If it decides to drop to the bottom boundary of this pattern, Gold could settle for a bottom around the 1650ish area. Mining stocks may have completed corrective wave iv down, with v-up to follow, and possibly starting now.
Our Blue Chip key trend-finder indicators generated a Neutral signal March 26th, 2021 and remain there Thursday, April 8th, 2021. The Purchasing Power Indicator component triggered a Buy signal Friday, March 26th. The 14-day Stochastic Indicator generated a Buy on March 26th, 2021, and the 30 Day Stochastic Indicator generated a Sell on March 19th, 2021. When these three indicators agree, it is a short-term (1 week to 3 months' time horizon) key trend-finder directional signal. When these three indicators are in conflict with one another, it is a Neutral (Sideways) key trend-finder indicator signal.
Demand Power Fell 2 to 466 Thursday, while Supply Pressure fell 4 to 414, telling us Thursday's Blue Chip rise was weak. This DP/SP Indicator moved to an Enter Long Signal March 26th, and remains there Thursday, April 8th, 2021.
The HUI key trend-finder indicator triggered a Buy signal April 1st, as the HUI 30 Day Stochastic triggered a Buy signal April 1st, 2021, and our HUI Purchasing Power Indicator triggered a Buy on April 1st. When these two indicators agree, it is a directional signal, and when at odds with one another, it is a combination neutral signal. The HUI Demand Power / Supply Pressure Indicator moved to an Exit Short signal April 1st. On Thursday, April 8th, Demand Power rose 3 to 393 while Supply Pressure fell 3 to 383, telling us Thursday's HUI rise was mild.
DJIA/SPY PPI rose 2 to + 12.92, on a Buy
DJIA 30 Day Stochastic Fast 76.67 Slow 84.67 On a Sell
DJIA 14 Day Stochastic Fast 70.00 Slow 78.33 On a Buy
DJIA % Above 30 Day Average 76.67
DJIA % Above 10 Day Average 66.67
DJIA % Above 5 Day Average 53.33
Secondary Trend Indicator Rose 6 to + 21, On a Buy
Demand Power Fell 2 to 466, Supply Pressure Fell 4 to 414 Buy
McClellan Oscillator rose to Positive + 86.88
McClellan Osc Summation Index + 2970.49
Plunge Protection Team Indicator -5.77, an "OFF" signal
DJIA 10 Day Advance/Decline Indicator + 669.2 on a Buy
NYSE New Highs 245 New Lows 9
Today's Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators moved to a Buy signal Thursday, April 1st, 2021, and remain there April 8th, 2021. The NDX Purchasing Power Indicator generated a Buy on March 26th, 2021, the NDX 14 Day Stochastic triggered a Buy on April 1st, and the 30 Day Stochastic triggered a Buy signal on March 26th, 2021. When all three component indicators are in agreement on signals, it is a consensus directional signal. When they differ, it is a sideways signal.
The NDX Demand Power / Supply Pressure Indicator moved to an Enter Long positions signal Wednesday, March 31st and remains there April 8th. On Thursday, April 8th, Demand Power Up 1 to 494, while Supply Pressure Fell 8 to 430, telling us Thursday's rise was mild and due more to a lack of selling interest rather than a strong urge to buy.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Buy signal March 11th, 2021, and needs to fall below negative - 5.0 for a new Sell. It rose to positive + 23.8 on Thursday, April 8th.
NDX PPI Rose 5 to 277.20, On a Buy
NDX 30 Day Stochastic Fast 82.93 Slow 83.17 On a Buy
NDX 14 Day Stochastic Fast 73.81 Slow 75.95 On a Buy
NDX 10 Day Advance/Decline Line Indicator + 23.8 On a Buy
NDX Demand Power Up 1 to 494, Supply Pressure Fell 8 to 430 Buy
RUT PPI Up 2 to 204.22, on a Buy
RUT 10 Day Advance/Decline Line Indicator + 278.10, On a Buy
Today's Mining Stocks and Precious Metals Market Comments:
Our HUI key trend-finder indicators moved to a Buy signal April 1st, 2021.
HUI PPI Up 3 to + 248.55, on a Buy
HUI 30 Day Stochastic Fast 95.00, Slow 58.33 on a Buy
HUI Demand Power Up 3 to 393; Supply Pressure Fell 3 to 383 Buy