• 22 hours The Lucrative New Tech Hijacking Your Privacy
  • 1 day The Biggest Loser In The China-U.S. Tariff Tit-For-Tat
  • 2 days Trade War Takes Its Toll On Shipping
  • 4 days Is $90 Oil Possible? An Interview With Jay Park
  • 5 days Billions Of Dollars Are Flooding Into The Flying Taxi Space
  • 5 days Is This The Most Important Energy Project Of 2020?
  • 6 days Startups Are Dying To Give You A Better Death
  • 6 days U.S. Restaurants Are Struggling With Rising Labor Costs
  • 7 days The Banking Bonanza Is Just Getting Started
  • 7 days How The Trade War Ceasefire Will Impact The Energy Industry
  • 8 days Who Is The Most Dangerous Person On The Internet?
  • 8 days SoftBank Sees First Quarterly Loss In 14 Years
  • 10 days Prepare For An Oil Glut In 2020
  • 11 days Why A Strong Yuan Is A Promising Sign For The Trade War
  • 12 days What Would You Sacrifice For A Debt-Free Life?
  • 12 days Shareholders Urge Major Bank To Stop Funding Fossil Fuel Companies
  • 12 days Tariffs Are Causing A Slowdown In U.S. Manufacturing
  • 13 days The Great Silicon Valley Migration Has Begun
  • 13 days 3 Oil Stocks Paying Out Promising Dividends In 2020
  • 14 days How Fractional Trading Is Democratizing the Stock Markets
Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

  1. Home
  2. Markets
  3. Other

Technical Market Report

The good news is:
•  With exceptions in the energy group virtually every short and intermediateterm indicator in every sector turned upward last week.

Summation indices (SI) are a running total of oscillator values. When an oscillator is above 0 it's SI rises when it is below 0 it's SI falls. The direction of SI's offers a good intermediate term indicator of market direction. The chart below shows the NASDAQ composite along with SI's of oscillators calculated from advancing - declining issues, new highs and new lows and advancing - declining volume. All of SI's turned upward last week.

The energy group offers a break from the tedium of chart after chart pointing upward. The chart below shows the same indicators as the one above, except they are calculated from the component issues of the Amex Oil Index (XOI). New high and new low data were calculated over the trailing 6 weeks rather than 52 weeks as reported by the exchanges. The energy sector was the only negative exception.

This time of year the market often gets into a rhythm of rising around the end of the month and falling during the middle of the month. The two charts below show the NASDAQ composite along with an indicator showing momentum of NASDAQ new highs. The indicator does a good job of exaggerating that monthly rhythm. The charts both cover 6 months, the first ends last Friday while the second shows last year through the end of the year. I moved the second chart two months to the right so that July - October line up. If the pattern holds, there should be weakness the second and third weeks of November, a Thanksgiving rally into December then weakness in early December followed by the Santa Claus rally beginning just before Christmas.

Seasonally the first 5 trading days of November are strong, but in the 4th year of the presidential cycle the average gain has been only about half of that during all years combined.

First 5 days of November.
The number following the daily return represents the day of the week;
1 = Monday, 2 = Tuesday etc.
The Number following the year is its position in the 4 year presidential
cycle.

R2K Day1 Day2 Day3 Day4 Day5 Totals
1988-4 -0.03% 2 -0.16% 3 0.11% 4 -0.60% 5 -1.02% 1 -1.70%
1989-1 0.21% 3 -0.34% 4 0.08% 5 -0.97% 1 0.02% 2 -1.00%
1990-2 0.08% 4 1.20% 5 0.79% 1 0.01% 2 -0.78% 3 1.29%
1991-3 -0.19% 5 -0.41% 1 0.05% 2 0.22% 3 0.78% 4 0.45%
1992-4 0.50% 1 -0.14% 2 -0.04% 3 0.61% 4 0.39% 5 1.33%
1993-1 0.12% 1 0.26% 2 -1.18% 3 -1.56% 4 0.00% 5 -2.35%
1994-2 -0.60% 2 0.11% 3 0.16% 4 -0.55% 5 -0.36% 1 -1.25%
1995-3 0.49% 3 1.11% 4 0.60% 5 0.05% 1 -0.49% 2 1.75%
1996-4 -0.24% 5 0.04% 1 -0.01% 2 0.76% 3 0.54% 4 1.09%
1997-1 1.78% 1 0.30% 2 0.55% 3 -0.43% 4 -1.72% 5 0.48%
1998-2 2.29% 1 0.19% 2 1.39% 3 0.97% 4 0.89% 5 5.74%
1999-3 0.74% 1 0.13% 2 1.40% 3 0.33% 4 0.57% 5 3.18%
2000-4 -0.50% 3 2.38% 4 0.15% 5 -0.75% 1 0.41% 2 1.69%
2001-1 1.57% 4 -0.42% 5 1.03% 1 1.20% 2 -0.45% 3 2.93%
2002-2 2.66% 5 0.92% 1 -0.23% 2 1.73% 3 -2.44% 4 2.64%
2003-3 1.82% 1 0.19% 2 0.01% 3 0.75% 4 0.00% 5 2.77%
Averages 0.67% 0.34% 0.30% 0.11% -0.24% 1.19%
Winners 69% 69% 75% 63% 53% 75%
 
R2K - Presidential year breakdown
Year 4 Day1 Day2 Day3 Day4 Day5 Totals
1988-4 -0.03% 2 -0.16% 3 0.11% 4 -0.60% 5 -1.02% 1 -1.70%
1992-4 0.50% 1 -0.14% 2 -0.04% 3 0.61% 4 0.39% 5 1.33%
1996-4 -0.24% 5 0.04% 1 -0.01% 2 0.76% 3 0.54% 4 1.09%
2000-4 -0.50% 3 2.38% 4 0.15% 5 -0.75% 1 0.41% 2 1.69%
Averages -0.07% 0.53% 0.05% 0.01% 0.08% 0.60%
Winners 25% 50% 50% 50% 75% 75%
 
SPX Day1 Day2 Day3 Day4 Day5 Totals
1988-4 0.03% 2 0.00% 3 0.05% 4 -1.04% 5 -0.86% 1 -1.81%
1989-1 0.25% 3 -0.80% 4 -0.25% 5 -1.48% 1 0.66% 2 -1.63%
1990-2 0.99% 4 1.57% 5 0.88% 1 -0.94% 2 -1.80% 3 0.70%
1991-3 -0.29% 5 -0.27% 1 -0.40% 2 0.32% 3 0.96% 4 0.33%
1992-4 0.97% 1 -0.67% 2 -0.67% 3 0.29% 4 -0.18% 5 -0.25%
1993-1 0.27% 1 -0.14% 2 -1.16% 3 -1.19% 4 0.45% 5 -1.77%
1994-2 -0.83% 2 -0.41% 3 0.30% 4 -1.20% 5 0.17% 1 -1.97%
1995-3 0.47% 3 0.94% 4 0.14% 5 -0.36% 1 -0.36% 2 0.83%
1996-4 -0.21% 5 0.42% 1 1.05% 2 1.46% 3 0.42% 4 3.14%
1997-1 2.66% 1 0.19% 2 0.21% 3 -0.50% 4 -1.12% 5 1.44%
1998-2 1.18% 1 -0.07% 2 0.70% 3 1.36% 4 0.63% 5 3.80%
1999-3 -0.65% 1 -0.47% 2 0.53% 3 0.57% 4 0.56% 5 0.54%
2000-4 -0.57% 3 0.50% 4 -0.11% 5 0.39% 1 -0.02% 2 0.18%
2001-1 2.29% 4 0.29% 5 1.44% 1 1.45% 2 -0.27% 3 5.20%
2002-2 1.72% 5 0.82% 1 0.78% 2 0.91% 3 -2.29% 4 1.94%
2003-3 0.79% 1 -0.54% 2 -0.14% 3 0.59% 4 -0.46% 5 0.25%
Averages 0.57% 0.09% 0.21% 0.04% -0.22% 0.68%
Winners 69% 47% 63% 56% 44% 69%
 
SPX - Presidential year breakdown
Year 4 Day1 Day2 Day3 Day4 Day5 Totals
1988-4 0.03% 2 0.00% 3 0.05% 4 -1.04% 5 -0.86% 1 -1.81%
1992-4 0.97% 1 -0.67% 2 -0.67% 3 0.29% 4 -0.18% 5 -0.25%
1996-4 -0.21% 5 0.42% 1 1.05% 2 1.46% 3 0.42% 4 3.14%
2000-4 -0.57% 3 0.50% 4 -0.11% 5 0.39% 1 -0.02% 2 0.18%
Averages 0.05% 0.08% 0.08% 0.28% -0.16% 0.31%
Winners 50% 67% 50% 75% 25% 50%

Every broad market indicator that matters turned upward last week and seasonally the first week in November has been strong.

I expect the major indices to be higher on Friday November 5 than they were on Friday October 29.

Back to homepage

Leave a comment

Leave a comment