DecisionPoint

January 2018

DecisionPoint

$VIX Flying High, This Has Bullish Implications

by Erin Swenlin

One chart that I have been watching very closely is the DecisionPoint Climactic Indicator chart. I use this chart to give me an idea of very short-term sentiment and how to use it to determine possible tops and bottoms. Today I'm seeing some extremes that could be telling us to expect a turnaround by week's end. Granted it's been only one day of real decline, but many viewers of MarketWatchers LIVE were hinting at some major discomfort with today's price action which to me proves the point that sentiment moved very bearish today. Sentiment is contrarian, so this is bullish for the very Read More 

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Mid-Cap and Small-Cap ETFs Deteriorating (IJH & IJR)

by Erin Swenlin

It is very tough to find weakness in the major indexes as they continue to fly higher. However, I was reviewing my DecisionPoint LIVE ChartList and noted that we are seeing a few warning signs on the small and mid-cap ETFs, IJR and IJH.  Currently, both IJH and IJR have PMOs that have topped. All of the major large cap indexes that we follow on the DecisionPoint Scoreboards (NDX, OEX, Dow, SPX) have PMOs that are rising. Relatively speaking, IJH has more problems than IJR. The mid-caps topped last week and have yet to set a new intraday high. Price is now sitting along Read More 

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DP Weekly Wrap: Market Pumps; Dollar Dumps

by Carl Swenlin

This week the market underwent a horrifying intraday reversal. Just kidding. There was a surprising reversal on Wednesday, but by the close SPY was virtually unchanged. We can see on the chart that at the intraday low the steep January rising trend line was barely tested. And in the context of January's advance it is as if nothing dramatic happened at all. Which, I guess, it didn't. The DecisionPoint Weekly Wrap presents an end-of-week assessment of the trend and condition of the stock market (S&P 500), the U.S. Dollar, Gold, Crude Oil, and Read More 

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Volatility Indexes for NDX ($VXN) and Gold ($GVZ) Suggest Rally Pop Ahead

by Erin Swenlin

Many of you may not be aware, but DecisionPoint has charts for most of the volatility indexes in the DecisionPoint Market Indicator ChartPack. We're in the process of updating the ChartPack, but there's no reason you can't download it now and enjoy the plethora of indicators available to you for most major indexes. I hadn't looked at this ChartList with the volatility indexes in a very long time. I primarily use the volatility index as a very short-term sentiment indicator. Based on the NDX and Gold volatility indexes, I'm expecting a "rally pop". I have no idea if this is my own term or Read More 

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DP Alert: Bull Flag Executes on USO! New Upside Target

by Erin Swenlin

The DecisionPoint Scoreboards remain green as momentum is positive and price trends continue higher in this seemingly unending bull market rally. I'm seeing a few cracks in the pavement right now in the short-term indicators with a negative divergence between breadth and volume. USO began executing a bull flag yesterday and today it took off. I'll give you my thoughts on a potential upside target in the section on Oil below. The purpose of the DecisionPoint Alert Daily Update is to quickly review the day's action Read More 

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Near-Term Divergence Ends Between Swenlin Trading Oscillators (STOs), Intermediate Term Remains

by Erin Swenlin

On Monday's MarketWatchers LIVE program during the "DecisionPoint Report", I highlighted a divergence between the Swenlin Trading Oscillators (STOs). I admitted that I hadn't seen a divergence lasting over a day or two. These are short-term indicators that generally travel in concert. The difference between them is that one is based on breadth (advances/declines) and the other on volume (advancing/declining volume). This divergence began last week and ended today. Seeing the divergence between the STO-B and STO-V with the volume indicator moving lower suggests that volume wasn't Read More 

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DP Weekly Wrap: Almost A Top

by Carl Swenlin

Friday was the last trading day before options expiration, so higher than normal volume should be attributed to that, not to other interpretations of volume versus price movement. We began the trading week with another breakout to new, all-time highs, but that turned into an intraday reversal. But not to worry, the decline only brought price back to the January rising trend line, which held for the rest of the week. In the process, price was squeezed into a short-term rising wedge. Typically, these formations resolve downward, but, let me guess, this wedge will probably resolve to the Read More 

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Anatomy of a Trade: Kelly Services (KELYA) - Stops/Targets/Evaluation

by Erin Swenlin

One of my favorite segments to do and watch on the MarketWatchers LIVE show M-F 12:00p - 1:30p EST is the "Anatomy of a Trade". Tom Bowley, my co-host, is a very short-term trader and generally has a handful of trades to discuss. However, I'm not nearly as active as Tom so I usually go through a "paper trade" to explain my trading strategy. Today's blog article is based on a paper trade. One thing to always remember is to stick to your strategy and not get too emotionally involved in a trade--easier said than done, right? I'm going to run through a trade as it happened and explain my Read More 

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DP Alert: Market Overbought or the "New Normal"? - UUP H&S Executing As Expected

by Erin Swenlin

As we watch the SPX continue to move higher in parabolic fashion, it's of course natural to begin to worry about a market collapse. During today's MarketWatchers LIVE show, Tom and I went over what we think are good "alerts" to the bear market switchover. However, Carl made a great point in Friday's "Weekly Wrap" that we could be looking at a "new normal" as far as bull and bear markets are concerned.    Note the long-term monthly chart below. Monthly PMO SELL signals have worked quite well to warn of impending bear markets or corrections Read More 

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DP Weekly Wrap: Zoom!

by Carl Swenlin

Positive events resulting from the recent tax cut legislation continued to lift the market this week, bonuses and pay raises being most prominent in the headlines. I'm sure that there is a substantial element of anticipation as to the positive effects of corporate taxes being cut by 40%, but I think it will take a while before we have an accurate assessment of the bottom line. At any rate, I think we're watching prices being adjusted upward in response to the new reality. The DecisionPoint Weekly Wrap presents an end-of-week assessment of the Read More 

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Bad News for Bonds - New IT Trend Model Neutral - 30-Yr Yields Prepare for Breakout

by Erin Swenlin

Today I received notice that TLT had triggered a new Intermediate-Term Trend Model (ITTM) Neutral signal. I decided to take a look at $TYX to see if yields were lining up with the action on TLT. Of course the relationship between TLT and $TYX is inverse, so a bearish TLT chart should yield (no pun intended) a 30-Yr Treasury Yield chart that is bullish. It did, only in a slightly different way than I expected. The new ITTM Neutral signal was generated when the 20-EMA crossed below the 50-EMA. It was not a SELL signal because the 50-EMA is above the 200-EMA which implies TLT is in a bull Read More 

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DP Alert: Bullish Indicators, But isn't it Time for a Pause? - Flag or Island Reversal on USO?

by Erin Swenlin

Carl always told me that you shouldn't put questions in the title of your articles unless you plan on answering them. I will. First, I want to point out the all green DecisionPoint Scoreboards. As I told listeners this morning, since I've been tracking these Scoreboards over three years, this is only the second time they have been all green; and the first time it only lasted two days and the market began to pause and top somewhat which added a few PMO SELL signals. I would look at these "all green" boards as a possible warning we will see a pause or pullback soon.  Read More 

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DP Weekly Wrap: A Record of Our Own

by Carl Swenlin

The market was flat for the last two weeks of December, and I thought that might be a sign that it was hanging on by its fingernails until the first of the year, when we might see some profit taking. But, no. Why take profits when the market seems to be bulletproof? I have been hearing about a lot of positive statistical 'firsts' regarding market performance in the last year, and I recently realized I have a first of my own to report. The DecisionPoint Weekly Wrap presents an end-of-week assessment of the trend and condition of the stock market Read More 

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DP Bulletin: Dow Regains PMO BUY Signal - DP Scoreboards ALL Green

by Erin Swenlin

A quick bulletin to let you all know that we got a new PMO BUY signal on the Dow. I've been writing about this the past few days so no one should be surprised. At this point my concern again is for more whipsaw if the market takes a breath or pulls back in a holiday hangover. Despite a bearish pattern, bullish confirmations and PMO BUY signal will likely override the pattern's call for a corrective move. Look for sideways consolidation or a pullback to the rising bottoms trend line. Helpful DecisionPoint Links: Read More 

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Dow Finally Breaks Out

by Erin Swenlin

If you look at the DP Scoreboards below, you'll note that the Dow is the only Scoreboard with "red" on it. It is highly likely that red arrow or PMO SELL signal will evaporate tomorrow if we see a follow-on rally or even a slight rise. I'll send out a "DP Bulletin" when/if that crossover occurs. Looking at the chart, you can see that the Dow basically spent the last half of December in a consolidation zone. The rally of yesterday and today set new all-time highs. While I have annotated a bearish rising wedge, I think "bull market rules" apply, meaning it will not likely resolve Read More 

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DP Alert: Whipsaw Back to BUY Signals - Dow Left Out

by Erin Swenlin

I had a bad feeling about the array of PMO SELL signals that appeared Friday and Tuesday. It wasn't worry about an upcoming decline, more the concern we'd see a whipsaw right back to BUY signals, which we did. Interestingly, the Dow was left out and remains on a PMO SELL signal as it struggles just to turn back up. You'll note under the "arrows" the date the signal generated. The purpose of the DecisionPoint Alert Daily Update is to quickly review the day's Read More 

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Pausing Market Triggers Whipsaw PMO SELL Signals on DP Scoreboards - New ITTM BUY Signal for Gold

by Erin Swenlin

On Friday, the SPX, OEX and Dow logged new PMO SELL signals. This was a function of the market consolidating and holiday trading, but it is important to note that these signals are arriving in overbought territory for these PMOs. After today's trading, their PMOs are already decelerating in an attempt to turn around. This means we could see a reversal of these signals very soon.  Gold has been enjoying a strong rally and today it was confirmed by the new IT Trend Model BUY signal. Let's first look at all four of the Scoreboard indexes Read More