Tea leaves reading, and whatever one does with entrails.
MuHugh this day
Death-cross and Hindenburg Omen for some stuff, and breaking to the upper side of decade-long cup and handle for other stuff.
Very exciting stuff.
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Today's Market Comments:
Stocks got pummeled Monday, March 7th. It was an ugly day. The decline came on sharply higher volume. Smart money is unloading shares with both hands. Buyers are AWOL. The Industrials hit a new Closing Low for the Bear market, closing below the February 24th intraday bottom. The three major averages closed at or near bottom tick for the day. Investors need to fasten their seat belts. The next leg of the Bear market will likely not be orderly as the first leg down was. A waterfall drop could happen.
The NASDAQ 100 generated a Death Cross last week. The Industrials are on the threshold of generating their own. A Death Cross is where the 50 day Moving Average drops below the 200 day M.A. This is a dangerous development, and is considered at least an Intermediate-term (6 to 12 months) Bear Market signal. It is a factor that could trigger computer selling. Many consider this a longer-term Bear Market signal. The NDX decline from its all-time high in November 2021 has already seen a 22 percent crash.
The Industrials and Transportation average generated a Dow Theory Bear market signal a couple of weeks ago.
After three close attempts last week, the Stock Market finally triggering a second H.O. observation Monday, confirming the signal we got on March 1st. This means the odds of another stock market crash are higher than random, much higher, and this H.O. warning is on the clock through July 7th, 2022. This means there are again, now, three contemporaneous Official H.O's on the clock. The stock market crash warnings keep coming. New Lows rose to 486 Monday. Not good.
The power behind Monday's stock market plunge increases the odds that corrective Minor degree wave 2-up for the Blue Chips, and wave ii-up for the NASDAQ 100, have topped, are complete. Now that these wave twos are finished, wave threes down are underway. Monday's decline was a five wave drop, likely the first subwave for the next wave three down. If so, we could see a small bounce for a few days, before a powerful decline arrives, one that could be the largest drop we have seen so far in 2022. If the bounce does not occur, it means the five wave drop is a series of smaller degree waves 1-down, and 2-up, which would be ominous.
The recent stock market plunge came with several Hindenburg Omens on the clock simultaneously, warning of the serious fragility of stocks, and the likelihood of a crash. These proved prescient once again. There were H.O.'s on the clock for every single previous crash over the past 36 years.
The stock market currently sits on three simultaneous "official" Hindenburg Omen potential stock market crash signals. The H.O.'s are warning that the odds for a full-blown stock market crash are far higher than random at this time, one on the clock through July, one through May, the other through April. March into May is setting up to be particularly ugly.
We can expect a continuing wild ride for the Stock Market in 2022. There are going to be a total of 18 Phi Mate and significant Bradley Model turn dates throughout 2022. There will be 7 turns that both cycle methods identify together. Those will likely be major turns in the stock market. By comparison, there were only 8 total Phi Mate and Bradley Model turn dates during 2021, with only two turns identified by both at the same time. We will progressively feed these forward dates to you during 2022. Trend Turns typically occur +/- a few days from these dates.
Our intermediate term Secondary Trend Indicator generated a Sell signal November 26th. It fell 7 points Monday (out of a possible 9 points), to negative - 59.
The Blue Chip three component key indicator moved to a Neutral signal Monday, March 7th, as the Purchasing Power Indicator triggered a Sell. The NASDAQ 100 three component key indicator remains on a Neutral signal, but its 14 day Stochastic went to a Sell March 7th. The small cap Russell 2000's Purchasing Power Indicator generated a new Sell signal March 7th.
Our Blue Chip key trend-finder indicators generated a Neutral signal March 7th, 2022 and remain there Monday, March 7th, 2022. The Purchasing Power Indicator component triggered a Sell signal Monday, March 7th. The 14-day Stochastic Indicator generated a Buy on February 25th, 2022, and the 30-Day Stochastic Indicator generated a Buy on March 2nd, 2022. When these three indicators agree, it is a short-term (1 week to 3 months' time horizon) key trend-finder directional signal. When these three indicators are in conflict with one another, it is a Neutral (Sideways) key trend-finder indicator signal.
Demand Power fell 11 to 490 Monday, while Supply Pressure Rose 28 to 566, telling us Monday's Blue Chip decline was powerful with a massive aggressive effort by the Plunge Protection Team to prevent a crash. This DP/SP Indicator generated a Sell Signal January 18th.
Today's Mining Stocks and Precious Metals Market Comments:
Gold has finally broken out decisively above the declining upper boundary of the "Handle" portion of a huge Bullish Cup and Handle pattern that started in 2011. This is a major development for Gold, which very likely will carry over into Silver and Mining stocks. The charts on pages 56 through 59 tell the story. This is an impressive Bullish development for Gold bugs. Nothing moves straight up or down, there are corrections as prices progress, however the long-term picture for Gold is now quite Bullish, without the long wait. Gold is headed for 3,000. Resistance levels are 1,975 (which Gold just blew past), 2,025, 2,100, and 2,350 along the journey toward 3,000 - or even higher.
Gold rose 29.3 Monday, March 7th, with Silver down 0.07, while Mining stocks rose 7.86.
The HUI key trend-finder indicator triggered a Buy signal February 7th, 2022, as the HUI 30 Day Stochastic triggered a Buy signal February 7th, and the HUI Purchasing Power Indicator triggered a Buy on February 7th. When these two indicators agree, it is a directional signal, and when at odds with one another, it is a combination neutral signal. The HUI Demand Power / Supply Pressure Indicator triggered a Buy signal February 14th. On Monday, March 7th, Demand Power rose 6 to 443 while Supply Pressure fell 2 to 387, telling us Monday's rise was moderate.
DJIA/SPY PPI fell 18 to negative -41.13, on a Sell
DJIA 30 Day Stochastic Fast 23.33 Slow 27.33 On a Buy
DJIA 14 Day Stochastic Fast 40.00 Slow 43.33 On a Buy
DJIA % Above 30 Day Average 23.33
DJIA % Above 10 Day Average 40.00
DJIA % Above 5 Day Average 33.33
Secondary Trend Indicator Fell 7 to Negative - 59, On a Sell
Demand Power Fell 11 to 490, Supply Pressure Up 28 to 566 on a Sell
McClellan Oscillator fell to negative -87.17
McClellan Osc Summation Index -1384.91
DJIA 10 Day Advance/Decline Indicator -394.5 on a Sell
NYSE New Highs 186 New Lows 486
Today's Technology NDX Market Comments:
The NDX Short-term key Trend-finder Indicators moved to a Neutral signal Friday, March 4th, 2022, and remain there March 7th, 2022. The NDX Purchasing Power Indicator generated a Sell on March 4th, 2022, the NDX 14 Day Stochastic triggered a Sell on March 7th, 2022, and the 30 Day Stochastic triggered a Buy signal on March 2nd, 2022. When all three component indicators are in agreement on signals, it is a consensus directional signal. When they differ, it is a sideways signal.
The NDX Demand Power / Supply Pressure Indicator moved to a Sell Signal Thursday, March 3rd, and remains there March 7th. On Monday, March 7th, Demand Power Fell 14 to 506, while Supply Pressure Rose 10 to 554, telling us Monday's decline was powerful.
The NDX 10 Day Average Advance/Decline Line Indicator triggered a Sell signal February 14th, and needs to rise above positive + 5.0 for a new Buy. It fell to negative -14.4 on Monday, March 7th.
NDX 100 Purchasing Power Indicator fell 18 to 211.43 On a Sell
NDX 30 Day Stochastic Fast 25.00 Slow 30.60 On a Buy
NDX 14 Day Stochastic Fast 26.00 Slow 42.80 On a Sell
NDX 10 Day Advance/Decline Line Indicator -14.4 On a Sell
NDX Demand Power Fell 14 to 506, Supply Pressure Up 10 to 554 Sell
RUT PPI Fell 4 to + 173.78, on a Sell
RUT 10 Day Advance/Decline Line Indicator - 288.20, On a Sell
McHugh's Market Forecasting and Trading Report and this Executive Summary from that report is an educational service providing a body of technical analysis that measures the possibility and probability of future changes in mass psychology (swings from pessimism to optimism and back) which identifies possible new trends in major markets within various time frames, from very short term (daily) through very long term (years and decades). |
