• 287 days Will The ECB Continue To Hike Rates?
  • 287 days Forbes: Aramco Remains Largest Company In The Middle East
  • 289 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 689 days Could Crypto Overtake Traditional Investment?
  • 694 days Americans Still Quitting Jobs At Record Pace
  • 696 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 699 days Is The Dollar Too Strong?
  • 699 days Big Tech Disappoints Investors on Earnings Calls
  • 700 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 702 days China Is Quietly Trying To Distance Itself From Russia
  • 702 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 706 days Crypto Investors Won Big In 2021
  • 706 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 707 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 709 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 710 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 713 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 714 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 714 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 716 days Are NFTs About To Take Over Gaming?
Strong U.S. Dollar Weighs On Blue Chip Earnings

Strong U.S. Dollar Weighs On Blue Chip Earnings

Earnings season is well underway,…

How Millennials Are Reshaping Real Estate

How Millennials Are Reshaping Real Estate

The real estate market is…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

  1. Home
  2. Markets
  3. Other

Technical Market Report for November 14, 2015

The good news is:
• The current weakness is part of a seasonal pattern that ends in a week.


The negatives

New lows rose on both the NYSE and NASDAQ every day over the past week finishing the week at over 200 on both exchanges. Those are big numbers.

The chart below covers the past 6 months showing the S&P 500 (SPX) in red and a 40% trend (4 day EMA) of NYSE new highs divided by new highs + new lows (NY HL Ratio), in blue. Dashed vertical lines have been drawn on the 1st trading day of each month. Dashed horizontal lines have been drawn at 10% levels for the indicator, the line is solid at the 50%, neutral level.

NY HL Ratio took a sharp dive into negative territory last week.

NY HL Ratio

The next chart is similar to the one above except it shows the NASDAQ composite (OTC) in blue and OTC HL Ratio, in red, has been calculated from NASDAQ data.

OTC HL Ratio also fell sharply.

OTC HL Ratio


The positives

The market is oversold, but this period of seasonal weakness has another week to run.


Seasonality

Next week includes the 5 trading days prior to the 3rd Friday of November during the 3rd year of the Presidential Cycle. The tables below show the daily change, on a percentage basis for that period.

OTC data covers the period from 1963 to 2014 while SPX data runs from 1953 to 2014 There are summaries for both the 3rd year of the Presidential Cycle and all years combined. Prior to 1953 the market traded 6 days a week so that data has been ignored.

Like last week, average returns for the coming week have been a little weaker during the 3rd year of the Presidential Cycle than other years.

Report for the week before the 3rd Friday of November.
The number following the year is the position in the Presidential Cycle.
Daily returns from Monday through 3rd Friday.

OTC Presidential Year 3
Year Mon Tue Wed Thur Fri Totals
1963-3 0.48% 0.17% -0.06% 0.20% -0.45% 0.34%
1967-3 0.24% -0.10% -0.25% 0.67% 1.04% 1.59%
1971-3 -0.45% 0.26% -0.07% -0.19% -0.47% -0.93%
 
1975-3 0.15% -0.61% -0.95% -0.26% 0.09% -1.58%
1979-3 0.88% 0.07% 0.45% 0.84% 0.11% 2.34%
1983-3 0.86% -0.21% 0.37% 0.47% 0.01% 1.49%
1987-3 -0.19% -1.74% 0.46% -1.35% -0.46% -3.27%
1991-3 0.48% 0.90% 0.09% -0.24% -4.24% -3.01%
Avg 0.44% -0.32% 0.08% -0.11% -0.90% -0.80%
 
1995-3 -0.51% -1.69% 0.12% 0.25% 0.05% -1.78%
1999-3 -0.05% 2.29% -0.73% 2.39% 0.66% 4.56%
2003-3 -1.07% -1.46% 0.95% -0.93% 0.64% -1.88%
2007-3 -1.67% 3.46% -1.10% -0.98% 0.72% 0.44%
2011-3 -0.80% 1.09% -1.73% -1.96% -0.60% -4.00%
Avg -0.82% 0.74% -0.50% -0.25% 0.29% -0.53%
 
OTC summary for Presidential Year 3 1963 - 2011
Avg -0.13% 0.19% -0.19% -0.08% -0.22% -0.44%
Win% 46% 54% 46% 46% 62% 46%
 
OTC summary for all years 1963 - 2014
Avg -0.14% 0.11% -0.10% 0.02% 0.04% -0.07%
Win% 45% 54% 56% 56% 56% 56%
 
SPX Presidential Year 3
Year Mon Tue Wed Thur Fri Totals
1955-3 2.59% -0.43% -0.65% -0.70% -0.11% 0.70%
1959-3 -1.11% 0.28% 1.08% -0.09% 0.05% 0.22%
1963-3 0.22% -0.39% 0.08% -0.46% -0.82% -1.38%
1967-3 -0.26% -0.63% 0.40% 0.92% 0.24% 0.67%
1971-3 -0.34% 0.98% 0.15% -0.78% -0.56% -0.55%
Avg 0.22% -0.04% 0.21% -0.22% -0.24% -0.07%
 
1975-3 0.54% -0.50% -1.12% -0.38% -0.12% -1.59%
1979-3 1.97% -0.55% 0.44% 0.72% -0.33% 2.25%
1983-3 0.17% -0.73% 0.44% 0.03% -0.63% -0.72%
1987-3 0.46% -1.51% 1.03% -2.24% 0.81% -1.45%
1991-3 0.06% 0.92% 0.17% -0.07% -3.66% -2.58%
Avg 0.64% -0.47% 0.19% -0.39% -0.78% -0.82%
 
1995-3 -0.07% -0.51% 0.79% 0.57% 0.46% 1.24%
1999-3 -0.12% 1.84% -0.66% 1.01% -0.21% 1.86%
2003-3 -0.64% -0.91% 0.80% -0.84% 0.16% -1.43%
2007-3 -1.00% 2.91% -0.71% -1.32% 0.52% 0.41%
2011-3 -0.96% 0.48% -1.66% -1.68% -0.04% -3.85%
Avg -0.56% 0.76% -0.29% -0.45% 0.18% -0.36%
 
SPX summary for Presidential Year 3 1955 - 2011
Avg 0.10% 0.08% 0.04% -0.35% -0.28% -0.41%
Win% 47% 40% 67% 33% 40% 47%
 
SPX summary for all years 1953 - 2014
Avg -0.02% 0.00% -0.05% -0.07% 0.14% 0.00%
Win% 48% 47% 61% 50% 62% 53%


Money supply (M2)

The money supply chart was provided by Gordon Harms. Money supply growth weakened last week.

S&P500 and M2 Money Supply


Conclusion

Seasonality and the breadth indicators are weak. Volume has remained low suggesting there has been no panic yet.

I expect the major averages to be lower on Friday November 20 than they were on Friday November 13.

This report is free to anyone who wants it, so please tell your friends. They can sign up at: http://www.stockmarket-ta.com/signup.html. If it is not for you, reply with REMOVE in the subject line.

These reports are archived at: http://www.safehaven.com/

Good Luck,

YTD W 18 / L 15 / T 12

 

Back to homepage

Leave a comment

Leave a comment