Daily S&P 500 INDEX TRACKER

[ananda77]

So far correction off 1635 has been very shallow with good support above 1620 - at this stage 1600 appears almost optimistic
...shallow does not do much to wear off long term accumulated excess (overbought) but that's maybe the Fed is prepared to give due to the wealth effect operative
...anyway, accumulating insurance above 1635 since if one does not made it so far....

Kind Regards

[winner69]

Interesting view of 'sideways markets'

You'll love it hoops

http://www.mauldineconomics.com/outs...e-we-there-yet

[Hoop]

Interesting view of 'sideways markets'

You'll love it hoops

http://www.mauldineconomics.com/outs...e-we-there-yet

Yeah Winner I did like it....His thinking methodology is similar to mine.

I wonder why, though, he calls it a "sideways market" rather than a secular Bear market?

His explanation of how during a period of increasing economic growth business profit can stall is interesting ....high profit margins being mean reverting due to new competitive players entering into the market and pulls down margins....his example Samsung entering Apple's Market...I mentioned something similar in the NZX50 thread + rising interest rate expense

Overall his outlook is very bearish...eh!

[winner69]

Haussmann points out that aggressive and persistent fed easing was the cause of the 2001 and 2008 market declines - the 50% ones


http://hussman.net/wmc/wmc130603.htm

[winner69]

This was interesting in that Haussmann article -


since 1940, when the S&P 500 has been above its 200-day moving average, the total return of the index has averaged 14.2% annually, versus just 4.5% when the index has been below its 200-day average.

S&P still above the 200 ma so alls ok at the moment

[Hoop]

“If you’re not confused, you don’t understand things very well.” — Charlie Munger, talking about today’s economy.
http://blogs.desmoinesregister.com/d...nclick_check=1

Sums up my view too. As Arb said on the GPG thread - when you don't understand an investment you once thought you did then you're best out.

If the market keeps going for another 10 or even 20% I'll not be surprised but the recent tank of markets at the mere suggestion that QE might end soon is enough to keep me in "winding down mode". The whole thing could be going Japanese - big time!

Edited: The GPG thing (and my other dogs) remind me of 2008 ... My dogs dropped before the overall market as (i'm guessing) investors gave up and went chasing better but over priced stocks. Time to be very cautious.

Belg..the golden stock MFT was also a leading indicator it broke its magnificent run back in end Feb/early March 2007 and the NZX50 index fell to bits 7.5 months later..after plateauing out and only going an extra 3% higher hampered by double (sub-formation multiple) tops

Now in 2013 MFT has again broken down in Early March...deja vu for the NZX50 in October 2013 ??

[ananda77]

So far correction off 1635 has been very shallow with good support above 1620 - at this stage 1600 appears almost optimistic
...shallow does not do much to wear off long term accumulated excess (overbought) but that's maybe the Fed is prepared to give due to the wealth effect operative
...anyway, accumulating insurance above 1635 since if one does not made it so far....

Kind Regards

...accumulating 'long' starting today *1624

Kind Regards

[Hoop]

Update from 30th April 2013
Since the 30th April caution post with 3 warnings out of 4 which started back in March, good news returned with May showing the all clear

However last week the S&P500 has once again went to the cliff edge...3 out of the required 4 warnings have once again been triggered (red arrows) indicating CAUTION
If the S&P 500 breaks the MA50 all 4 warning will be triggered...When all 4 warnings are triggered there is a very good chance of an imminent correction within the couple of days.....

EDIT PS....This present prolonged caution threatening and retreating over a period of several months in similar so far to the one that last occurred in March to May 2011 which in the end all 4 warnings fired to GET OUT within hours of the fall..there was a second chance (right shoulder) to get before the S&P500 corrected by 20% (see Charts)

[Hoop]

Agree. I'm watching my stocks like a hawk, waiting to hit sell as soon as they start breaking. So far everything is holding above the 200, and with quite a wide divergence between the 50 and 200 on many stocks it was expected that a correction would happen sometime. I wish Trackers would post that MSI chart update - where is he?

My big concern is that Australia is really going to the dogs for reasons unrelated to QE and this time won't follow the US indices, in which case the "correction" is the start of a nasty crash.

KW I cashed up nearly all my shares (mostly NZ shares) beginning a couple weeks ago...It took me up until Tuesday 4th to sell down...I've taken a defensive position of going from 5% cash to 85% cash...although my NZX TA Target is showing only a small/mild correction and the S&P500 going from caution to extreme caution and with today's drop still not triggering a get out warning...it is getting very close to busting that last of 4 indicators, that MA50 is only 4 points away now and another 5 or 6 = 10 to allow for margin of error (TA is not an exact science )....I take the view that I can always buy back in when the correction end is confirmed and the old bull lives on.

I'm also watching everything like a hawk.....The NZX50 is one of the few indexes left at the moment that is in sync with Wall St (S&P500, DOW). I suspect if Wall St melts down so will the NZX50... The AORDs used to be in sync, but not since 2011.....Atm the AORDs has already reversed its trend...this is not a good sign for the NZX50 as it is Australia is NZ's top trading partner.

Sooo...Wall St it is...Both (NZX50) indexes have 4.25 year old bulls ..both these bulls are living on bonus time now (median lifespan 3.75 years).

To try and gauge Wall St performance a little closer...and to avoid complexity with throws up too many conflicting arguments ...I have added another simple updated chart....This chart below is bias to momentum and trend reversals...Chandelier Exit indicator (green line) is a trailing stop/loss indicator but it can also be used as an indicator to detect trend reversals. I have added Commodity Channel Indicator as this momentum indicator also detects trend reversals although it can not be used in isolation as it is far too sensitive and on its own fires too many false signals.

Although not technically broken, the S&P chart is showing great concern.... the Chandelier exit indicator (green line) has intersected the price is well above the S&P price line high enough to be outside its margin of error zone...It would be safe to say that today's -1.38% gap down would be due to stop/loss positions being triggered and the sensitive CCI has confirmed it......In simple terms, short to possibly some medium term investors are exiting the market.....all now hinges on the MA50...that where my Sentiment Indicators NYA200r come in to play..and they have an extremely good record so far in predicting strong correcting down trending reversals.

Also of interest are reports coming out from various Analysts with conflicting views with Mainstream Media (with historical evidence to support) that QE does not directly help the Equity Market ..The Equities uptrend is based on mass investor positive sentiments towards QE ...Apparently history has shown that in its later stages prolonged QE is to blame for the reversal back to bear market conditions....Interestingly the USA is at this later QE stage now....The thought is now that QE can not prevent an Equity market downturn once investor sentiment turns....

[ananda77]

Hoop:

...your *1535 support also coincides with the median price line in the 2.5yr monthly time frame in my trading system - and price always shows tendency to retreat into the median over the longer term. Its a possibility, but chances right now for that are slim imo. Basically think around *1600 as the turning point. Under *1600, will give up strategy to accumulating 'long' started *1624.
There is just plenty of worry about the continuation of the bull and technically, its whimpering. But that's all the more reason to remain bullish until north of *1750/*1800 as a minimum.

Kind Regards