Hello everyone, its Stephen Whiteside here.
from TheUpTrend.com with this weekend's edition of Stock Market Timing Television..
Well let's start off with the good news..
The good news is it was a pretty good week..
Any time you're coming into a long weekend it usually has a bullish bias to it..
Friday we saw US markets open for half day, very quiet trading..
The SPY volume for Friday was 30 million.
and change, the previous Friday was 92 million and change..
So you can see the dramatic drop in volume on Friday..
So we're also coming up to the end of the month that also has a bullish bias to it..
And I think after month end that's where.
things should probably stop and we should start to head lower from there..
Probably not on the first trading day of December but certainly not expecting the.
bullish momentum to continue into December at this time..
Now let's move on and take a look at the VIX..
The VIX was weaker again, which is.
supported for higher stock prices, down another 11% and change..
Things would change this week if the VIX closed above 29.13 this coming Friday..
Looking at the daily charts you can see very quiet trading on Friday..
The VIX had an inside day..
We're looking for a close on Monday above $24.10. If that doesn't happen of course.
that upper channel line is going to continue to move lower daily..
Now looking at the daily panic zone chart for the VIX and we're mostly going to use.
weekly charts in this presentation, but we will flag when we show daily charts..
You can see we're currently ranked as zero..
We're now at the bottom of the panic zones..
The pressure zone has formed..
This is the time and place we look for a reversal..
Now we've been following the Dow closely for the last month or so..
I've talked more about the Dow in the last month than I have in the last 22 years..
But there's the Dow up at the top of the Panic Zones..
It hit our next price target on Friday..
Our next price target was 343. 75..
We got as high as 343. 80..
So just $0.05 above our target..
Now not only is this a daily target, but.
it is also a weekly target, which makes it much more significant..
And as you can see it held us in check back in the summer..
Now looking at the eyeshares for the TSX 60, it did something similar on Friday..
It also hit our next price target which is 31..
25..
So in both cases we've broken out above the summer high, but just barely..
It's not a major or significant breakout at all..
Now the high for the I shares for the TSX 60 on Friday was 31..
31, while our price target is at 31. 25..
And it is also a significant target.
because not only is it a daily, but it's also a weekly target..
And that weekly target held us in check back in the summer..
Now, I think the stock market is about to top here..
Of course, there's no evidence that that change has started..
So what we're looking at is possibilities,.
and we certainly don't have any triggers to take any action..
The only trigger that you have so far is if you were trading the Dow diamonds or if.
you were trading the Ishares for the TSX 60..
You had orders which got filled on Friday..
So congratulations..
You've taken some money off the table, but.
you have no reason to actually completely liquidate a position at this time..
Now, this is still a risk off rally, and.
that hasn't changed this week, and that's rather unfortunate..
Being in a risk off rally is very.
uncomfortable because more and more money is going into fewer and fewer stocks, and.
that's why you have the market being let higher by a stock like McDonald's and a.
stock like Tesla is going in the exact opposite direction..
So people with deeper pockets than you and I and more resources than you and I are.
staying away from anything technology related right now..
And it doesn't really matter what area of technology..
There's one area that's working..
But if we look at the QQQ's for the Nasdaq 100, we are still on a Weekly Sell signal..
No change for any of the ARK ETFs..
Whether you're looking at fintech, you're looking at Genomics, you're looking at the.
ARK Innovation ETF itself, which is heavily weighted in Tesla..
Then you've got the Ark Industrials, you've got Internet, and you've got space..
Money is not going into any of those areas.
of the market right now, and it's certainly not going into social media..
Now, let me pose a question to you..
How healthy do you think the market is if investors are only willing to put money.
into the stocks of yesterday and ignore the stocks of tomorrow?.
That tells me the market's not in a very healthy position at this time..
Of course, things could change over time..
They just didn't change this week..
Now, one area that the bulls can hang.
their hat on is the Chip Sector, which did pop a couple of weeks ago..
But you can see that there's been no upward momentum since then..
Even on the back of the big announcement that Warren Buffett took a big position in.
Taiwan Semiconductor, you can see that popped and then treaded water this week..
Now, there is one symbol you're going to watch closely this week..
This could be the make or break symbol for the week, and that's the spider ETF..
We're currently ranked at nine, so we're not overly overbought at the moment..
We're up in the overbought area, but we could still be ranked at ten..
We could still certainly move higher from here..
We are stuck at the 200 day moving average..
That seems to be an area of resistance right now..
And just above that is our next price target..
Now 406.25 is not only a weekly, but it's a daily target..
So when they match up like that, that is a more significant line in the sand..
And right now when we look up to the.
406.25 to get there, we start to move into an open gap..
Of course, an open gap is a hole..
It's a big pothole in the road that investors remember..
Anybody who was buying up there in September certainly remembers that day..
And the market has a memory..
And right now the bottom of that open gap.
is at 403.10. We got as high as 402.93, I believe on the week..
On Friday..
It was 402.91. So less than $0.20 away from the bottom of that gap..
So far you can see the fact that we haven't been able to run up and run into.
the gap that at the bottom of the gap is acting as resistance..
Then if we can break through the bottom of.
the gap, 406.25, and then the top of the gap is 408.46..
So there's some clustering there, there's some area of resistance that the market.
would need to get up and over and I'm not sure it's going to be able to do that..
Now, looking down, if you're watching the.
SPY ETF on Monday, we need to close below 392..
34 to give us a sell signal..
And of course, if that doesn't happen,.
that lower channel line is going to continue to move higher daily..
Now these next couple of charts aren't designed to scare anyone because we will.
certainly react to whatever the market gives us going forward..
But I've looked at this chart several.
times over the past month and what this particular piece of software from Timing.
Solutions gives us is a similarity engine and what that engine does..
And in this case, we're analyzing the SPY ETF in this particular chart..
I can't show the whole thing on the screen, but it goes back to when the.
Spider ETF actually went public back in the this particular engine will go and.
take a snapshot of the current market situation and see if there's any times in.
history when the market looked like this before..
And the closest match that we could come to was back in 2000 to 2002..
That is the closest match with the current market situation..
And the reason I'm showing you this is not.
to scare you, but just to let you know that from where we are right now, we could.
still go much further next year to the downside than where we are right now..
That is also true for the Nasdaq 100..
And again, the similarity engine went back in time and said, hey, where are we right.
now compared to where we've been in the past?.
And it matches us up with what happened in 2000 to 2002..
And again, the market can go much lower from where we are right now..
Now, right now, we're still on a weekly sell signal for the Nasdaq..
So if the Nasdaq wanted to go much lower.
from here, we would be on the right side of that market position..
Now, here's the last set of charts I want to use to look at the stock market, and.
it's one that pretty well everybody can understand..
This particular chart is looking at the.
percentage of stocks currently trading above the 50 day moving average..
Back in the summer, we used a similar chart..
We looked at a percentage of stocks currently trading above their five day.
moving average because we were looking at a smaller term time frame..
Now we're looking at the bigger time frame..
So this is a percentage of stocks.
currently trading above the 50 day moving average..
Now, when you get up to these levels, you're getting close to 100%..
And when a market gets up to 100%, that rarely happens..
But when you get up to that range, that's.
the time and place when the market usually turns around..
I don't know what the catalyst is going to be for that, but if we go back in time,.
the peaks on this particular chart match up with the peaks in the stock market..
Whether it's the high from August, the.
high from late May, early June, or the high from late March, early April,.
anytime that particular indicator was up near the top of the range, that's the time.
and place where the market started reverse..
Now, the last time that we saw a high like this was back in August..
If we look at the Canadian chart and this is for a longer time frame, but this is.
the percentage of stocks currently trading above the 50 day moving average..
We have not been this high in a few years..
So the Canadian market is very, very overbought at the present time..
Now, being overbought does not guarantee.
that the market completely reverses and heads sharply lower..
An overbought condition can be alleviated by just treading water..
We could tread water for a couple of weeks, and the percentage of stocks.
trading by the 50 day moving average could come down..
And that does not mean the market is going to crash..
But it certainly tells me that the S&P 500 trading up at its 200 day moving average.
may be as high as we can go at the present time..
Now, as I mentioned for this particular chart, which is a longer term time frame.
than the previous chart, the peaks that we see on this chart match.
up with all the peaks on the TSX that we've seen over the past couple of years..
Let's finish off taking a look at the weekly commodity prices..
And last week we had big bearish reversal.
signals, but we didn't see fall through to the downside..
For most of the charts, copper was down slightly..
That's not a major indicator that copper.
is going to continue to go lower from here..
It's still on a weekly buy signal..
Gold actually closed higher on the week by just $3, but that is better than where it.
was during the week when it dipped right into the channel..
And Silver also dipped into the channel.
too, and it was higher on the week, up 2.31 percent..
So some of those bearish reversal signals.
that we saw last week didn't really see any fall through to the downside..
Now on the other hand, energy starting off.
with crude oil was down nearly 5% on the week, nearly touching the $75 level..
And of course, $75 is our big line in the sand..
If you look at a daily chart below 75, 68..
75 would be our next target to the downside..
If we start breaking through 75..
Now, looking at the weekly panic zone.
chart, you can see that we are currently projecting down to the $50 level..
Of course, to get there, we've got to break through quite a bit of support..
Now natural gas on the other hand, had another wild week, closing up 6.27%,.
trading above the upper channel line, but closing back in the middle of the channel..
So another wild week..
It was positive, but still no weekly buy signal for natural gas..
And you can see for natural gas, the pros.
do not look like they want to take control at the present time..
Okay folks, that is all for this weekend's presentation..
We came into a long weekend..
Things are still looking pretty bullish..
We should expect to go into month end looking pretty bullish..
And then beyond that, I wouldn't be.
surprised if we saw some selling in the month of December..
Enjoy the rest of your weekend..
The next time you will hear my voice.
is on Tuesday morning video you..