Last November I asked the question "Are emerging markets about to emerge?"Using the iShares MSCI Emerging Markets ETF (EEM) as our benchmark, I concluded that more strength was needed in order to push the indicators into a bullish mode. In the intervening period, things have improved, but... READ MORE
Last November and December, it looked as if gold had broken out from a multi-year inverse head-and-shoulders. Since then, the price has dropped below the breakout area, and the long-term KST has begun to roll over. Just like takeoff and landing are the critical points for an aircraft, breakouts are... READ MORE
The vast majority of the primary trend indicators are pointing to a bull market and have been doing so for the better part of a year. Chart 1, for instance, shows that NYSE Margin Debt, or rather its long-term KST, has only recently gone bullish. The vertical lines point out... READ MORE
Oil is not only an important commodity in and of itself, but is also one has a substantial influence on commodity indexes in general. Its weight in the CRB Composite is 23%; for energy in total, it is 39%. Chart 1 compares the oil price to the CRB Composite, where... READ MORE
Some tools in technical analysis are totally objective, such as a moving average crossover. It may be debatable whether it's a decisive signal or not, but a crossover is nevertheless a crossover. Dow Theory, on the other hand, is much more subjective and, therefore, open to interpretation. For... READ MORE
Last week, eight new Bitcoin-based ETFs began trading courtesy of recent SEC approval. This launch was well anticipated, as the price had already run up in the hope that these new buyers would push it to an even higher level. The thought occurred to me that the situation is not... READ MORE
A couple of weeks ago, I took note of the widespread interest in small caps amongst the technical community. I don't normally follow cap plays, but my contrary bones began to shake when I saw such acclaim at their recent performance following several false dawns in the last... READ MORE
In this must-see once a year special, Martin breaks down his comprehensive equity market outlook for 2024, accompanied by Bruce Fraser. Encompassing a secular (multi-business cycle) perspective of the forces that are likely to influence stocks and bonds over the coming years, Martin presents a look ahead at what'... READ MORE
It has been a great rally, but this week has seen the DJIA violate its post November up trendline. In addition, the 9-day RSI has retreated below its 70 overbought zone for the first time since early November, and the daily KST has triggered a sell signal. Is it time... READ MORE
Over the years, emerging markets as a group have experienced huge swings in relative performance. The latest one, which began in 2010, has been quite bearish. When such linear trends dominate the scene, reliable cyclical indicators, such as the long-term KST or monthly MACD, often give premature buy signals and... READ MORE
I like to start off my approach to any market by taking a look at the long-term trend. That's because a rising tide not only lifts all boats, but the direction of the long-term trend determines the characteristics of those below it. For example, if the primary trend... READ MORE
Technology (XLK) and Communications Services (XLC) have been the leaders since the bull market began in October of last year. However, they may need to look over their shoulders, as financials have been creeping up since the October 27 intermediate low. The short answer to the question posed by the... READ MORE
A lot of the time, I write articles that focus on markets or technical situations that should be monitored for a potential turn. This one is no different, except to say that these markets are not close to breakout points, but right at them. In short, it's fish-or-cut-bait... READ MORE
We spend a lot of time analyzing sector rotation, but there are also other relationships that can offer useful insights to internal market dynamics. One aspect of this is the relationship between market averages. NASDAQ vs. the DJIA As an example, Chart 1 plots the relationship between the NASDAQ Composite... READ MORE
I last wrote about bonds and interest rates in August, as they were in the process of challenging their October 2022 highs. My conclusion at the time was that they were likely to go through, but that upside potential would be limited due to what seemed at the time to... READ MORE
A couple of weeks ago, I wrote an upbeat article on the market, pointing out the fact that many short- and intermediate-term indicators were in a potentially bullish position at a time when stocks seemed impervious to bad news. I concluded "That does not mean the market will go... READ MORE
Understandably, most Middle Eastern country ETFs have performed poorly since the war broke out, but there is one noticeable exception, which I will get to later. Israel First, as might be expected, the iShares Israel ETF (EIS) has moved lower and completed what looks to be a massive top. The... READ MORE
When Anwar Sadat, President of Egypt was assassinated in 1981, gold rallied sharply over the near-term, but the advance soon petered out. The reason was that gold was in a primary bear market, so the advance merely represented a counter-cyclical move. Gold has rallied sharply since the Middle East crisis... READ MORE
I must say, I was surprised that the outbreak of war in the Middle East and a 4% rise in oil sent the market higher, not lower by the close of business last Monday. Typically, a market that does not respond to bad news in a negative way is one... READ MORE
Several short-term charts suggest the SPDR Real Estate ETF (XLRE) is getting ready to rock and roll, thereby indicating an extension to this week's rebound is in the cards. It's possible that the expected rally could result in shifting some of the longer-term indicators towards a... READ MORE
The Dollar Index I last wrote an article on the dollar in August, The Dollar Index Goes to Missouri. In it, I pointed out that the Index had reached crucial resistance, which, if surpassed, would signal a new primary bull market and a likely fourth up leg to the secular... READ MORE
Chart 1 shows that the S&P Composite, like both A/D Lines, has completed and decisively broken down from a head-and-shoulders top. The two breadth indicators have also violated their bull market up trendlines. On the surface, things look pretty grim, with three seasonally weak September days left... READ MORE
The title of this article should really be more in the vein of two technical situations I am watching, because the long-term forces look as if they may be converging with short-term ones to form a kind of potential bullish reverse domino effect. Let's consider our first candidate,... READ MORE
The overall market has been rallying since registering its low last October. However, there is one sector which, in August, fell below its October low on a monthly closing basis. More serious is the fact that it recently violated a 23-year secular up trendline. Can you guess which sector I... READ MORE
The business cycle has been with us for as long as reliable financial records have been available, and that's at least 200 years. It may seem to be a mysterious force, but it is nothing more than a set sequence of chronological events that just keeps repeating. The... READ MORE
KEY TAKEAWAYS * Comparing risky asskets with more conservative ones can reflect investor confidence * Negative divergences offer subtle indications of a deterioration of a stock market rally * An upward trend indicates that investor confidence is positive Traders and investors pay a lot of attention to surveys to assess swings in sentiment,... READ MORE
The Dollar Index has experienced a nice rally since mid-July and now reached important resistance. It's time to show us whether it can push through, thereby signaling an important extension to the recent advance. Before we examine that possibility, however, let's briefly take a step backwards... READ MORE
The recent rise in interest rates and energy prices is certainly a cause for concern should these trends extend in any meaningful way over the next few months. After all, we are just about to enter September, which is seasonally the worst month of the year for stocks. Following that,... READ MORE
The 30-year yield reached its high point last October and has been rangebound since December. Chart 1 shows that it began to break out of that trading range in late July, but has yet to succeed in taking out the October high. The 14-day RSI is currently correcting from an... READ MORE
There have recently been a lot of depressing stories concerning the state of the Chinese economy. Here are a spattering of headlines that appeared just today: * China's Economic Recovery Weakens as Growth Concerns Linger (WSJ) * China Manufacturing Keeps Shrinking, Weighing on Economic Recovery (Bloomberg) * More Stimulus "Desperately... READ MORE
Last April, I wrote about the SVB (SVIB) banking crisis, using the KBW Regional Banking Index ($KRX) as a proxy, and suggested the price action in the right hand part of Chart 1 had the potential to be a double bottom formation. Double bottoms are characterized by heavy activity on... READ MORE
Last week, I pointed out that several indicators were close to triggering a bull market for commodities. Some of those benchmarks have since been met, but none have yet moved decisively in that direction. Now, it's time to take a deep dive into the copper price, as this... READ MORE
I have been bearish on the primary trend of commodities for some time whilst still maintaining a bullish stance on their secular or very long-term trend. In other words, negative over a 9-month-to-2-year outlook, but constructive on a 10-to-20-year one. The secular aspect is important, because history shows primary bear... READ MORE
There has been a notable shift in expectations concerning rate hikes going forward, as several Fed spokesmen have floated the idea of additional hikes later in the year. Rising interest rates are generally seen as a negative factor for stocks, as they increase borrowing costs for companies, lowering their profitability... READ MORE
The ellipses in Chart 1 reflect economic events that have adversely affected the stock market since the 1950s. The pink ones reflect recessions, and those colored in blue indicate setbacks that anticipated economic slowdowns. Slowdowns develop when some economic sectors slip into recession, but that weakness is insufficient to push... READ MORE
When the direction of the primary trend changes, it's usually because the business cycle is transitioning from a slowdown or recession to a recovery. That process usually results in a change in sector rotation, as defensive ones, such as utilities and consumer staples, come to the fore and... READ MORE
There used to be a rule of thumb on Wall Street that, whenever brokers upgraded to a new office after years of making do with smaller premises, it was the sign of market peak. Such behavior typically followed years of a bull market in which the investment houses had grown... READ MORE
The price of gold was recently trading at an all-time monthly closing high. Since then, it has backed off, raising the question of whether that was "the" top or whether the subsequent short-term price decline represents a healthy digestion of previous price gains, which will serve as a... READ MORE
The recent strong performance by a few tech stocks has gained widespread attention, as has the disappointing market breadth. The result has been a soaring NASDAQ and a lagging NYSE Composite and Dow. Small cap stocks have also left a lot to be desired. The question is whether this divergence,... READ MORE
In the last couple of months, we have seen a number of analysts and commentators point out that the current rally has been led by a handful of large-cap tech stocks and is therefore suspect. That observation suggests this week's extension to the advance is doomed. It'... READ MORE