• 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?
Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Tesla Struggles To Compete In European Market

Tesla Struggles To Compete In European Market

Tesla continues to catch the…

  1. Home
  2. Markets
  3. Other

Technical Market Report for June 20, 2015

The good news is:
• The Russell 2000 (R2K) and NASDAQ composite (OTC) both closed at all time highs on Thursday.


The negatives

The breadth dichotomy between the NASDAQ and NYSE markets continued last week with the NYSE much weaker than the NASDAQ.

The chart below covers the past 6 months showing the S&P500 (SPX) in red and a 10% trend (19 day EMA) of NYSE new highs (NY NH), in green. Dashed vertical lines have been drawn on the 1st trading day of each month.

NY NH remained near its low of the past 6 months.

NY NH Chart


The positives

To illustrate the dichotomy mentioned above, the chart below is similar to the 1st chart except it shows the OTC in blue and OTC NH, in green, has been calculated from NASDAQ data.

OTC NH has been moving sharply upward for over a month.

OTC NH Chart

The next chart covers the past 6 months showing the 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 horizontal lines have been drawn at 10% levels for the indicator, the line is solid at the 50%, neutral level.

A modest decline in the number of NYSE new lows enabled NY HL Ratio to move above the neutral line late last week.

NY HL Ratio

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

OTC HL Ratio continued its rise, reaching 79%, its strongest level in 2 months.

OTC HL Ratio


Seasonality

Next week includes the 5 trading days prior to the 4th Friday of June during the 3rd year of the Presidential Cycle.

The tables below show the daily change, on a percentage basis for the 5 trading days prior to the 4th Friday of June during the 3rd year of the Presidential Cycle.

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.

Average returns for the coming week have been slightly negative by most measures.

Report for the week before the 4th Friday of June.
The number following the year is the position in the Presidential Cycle.
Daily returns from Monday through the 4th Friday.

OTC Presidential Year 3
Year Mon Tue Wed Thur Fri Totals
1963-3 0.41% 0.20% -0.41% -0.79% -0.35% -0.94%
1967-3 1.04% 0.01% 0.33% -0.58% 0.24% 1.03%
1971-3 -1.53% -0.95% 0.47% 0.36% 0.18% -1.47%
 
1975-3 0.62% 0.54% 0.08% 0.17% 0.06% 1.47%
1979-3 -0.29% 0.15% 0.29% 0.19% 0.39% 0.73%
1983-3 -0.45% 0.41% 0.68% -0.26% 0.48% 0.86%
1987-3 0.04% -0.30% -0.17% -0.01% -0.12% -0.56%
1991-3 -2.18% -0.41% -0.05% 0.67% -0.07% -2.03%
Avg -0.45% 0.08% 0.17% 0.15% 0.15% 0.09%
 
1995-3 1.48% 0.84% -0.07% 1.17% -0.13% 3.29%
1999-3 2.61% -1.90% 0.69% -1.70% -0.05% -0.35%
2003-3 -2.07% -0.32% -0.18% 1.96% -0.54% -1.15%
2007-3 0.00% 0.01% -1.02% 0.65% -1.07% -1.43%
2011-3 0.50% 2.19% -0.67% 0.66% -1.26% 1.42%
Avg 0.50% 0.16% -0.25% 0.55% -0.61% 0.36%
 
OTC summary for Presidential Year 3 1963 - 2011
Avg 0.01% 0.04% 0.00% 0.19% -0.17% 0.07%
Win% 54% 62% 46% 62% 38% 46%
 
OTC summary for all years 1963- 2014
Avg -0.17% 0.07% 0.13% -0.09% -0.08% -0.15%
Win% 41% 61% 54% 59% 55% 53%
 
SPX Presidential Year 3
Year Mon Tue Wed Thur Fri Totals
1955-3 0.10% 0.92% 0.22% 0.37% 0.52% 2.13%
Avg 0.10% 0.92% 0.22% 0.37% 0.52% 2.13%
 
1959-3 0.00% -0.02% 0.51% 0.03% 0.96% 1.48%
1963-3 -0.07% -0.23% -0.90% -0.49% 0.43% -1.25%
1967-3 -0.03% -0.03% -0.30% -0.25% 0.03% -0.58%
1971-3 -1.11% -0.29% 0.84% -0.24% -0.18% -0.98%
1975-3 1.09% 0.61% 0.46% 0.20% 0.00% 2.36%
Avg -0.03% 0.01% 0.12% -0.15% 0.31% 0.20%
 
1979-3 -0.52% 0.02% 0.05% 0.45% 0.54% 0.54%
1983-3 -0.07% 0.89% 0.27% -0.25% -0.10% 0.75%
1987-3 0.87% -0.39% -0.51% 0.68% -0.58% 0.07%
1991-3 -1.80% -0.08% 0.25% 0.76% -0.87% -1.74%
1995-3 1.00% -0.04% -0.18% 1.30% -0.25% 1.83%
Avg -0.10% 0.08% -0.02% 0.59% -0.25% 0.29%
 
1999-3 0.45% -0.97% -0.21% -1.30% -0.04% -2.06%
2003-3 -1.31% 0.18% -0.83% 1.08% -0.97% -1.85%
2007-3 -0.12% 0.17% -1.36% 0.62% -1.29% -1.98%
2011-3 0.54% 1.34% -0.65% -0.28% -1.17% -0.22%
 
SPX summary for Presidential Year 3 1955 - 2011
Avg -0.07% 0.14% -0.16% 0.18% -0.21% -0.10%
Win% 43% 47% 47% 60% 36% 47%
 
SPX summary for all years 1953 - 2014
Avg -0.21% 0.14% 0.06% -0.08% -0.14% -0.23%
Win% 38% 56% 53% 51% 44% 51%


Money supply (M2)

The money supply chart was provided by Gordon Harms. M2 growth has dropped below its trend line.

S&P500 Daily Chart and M2 Money Supply


Conclusion

The secondary indices have been outperforming the blue chip indices and NASDAQ breadth indicators have been outperforming NYSE breadth indicators. Not perfect, but not bad.

I expect the major averages to be higher on Friday June 26 than they were on Friday June 19.

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 9 / L 8 / T 7

 

Back to homepage

Leave a comment

Leave a comment