DOW DROPS INTO BEAR TERRITORY... Friday's strong rebound helped prevent a very bad week in stocks from getting worse. And it came at a good time. That's because of number of U.S. stock indexes are nearing tests of major long-term support lines. We'll... READ MORE
This week has seen U.S. administration fiscal proposals, as well as 1.5 trillion dollars in Fed support, aimed at limiting the economic damage from COVID-19. Friday saw a travel ban put into effect, along with a state of emergency. Unfortunately, these actions, just like the previous week'... READ MORE
WORLD STOCK INDEX NEARS TEST OF LONG-TERM SUPPORT...The Dow Industrials entered a bear market yesterday when it closed more than -20% off its recent high. Another big global selloff today has put the world's stocks in a bear market as well. Which suggests that stocks in the... READ MORE
* Bonds and Yen Starting to Lose Safety Appeal? * One Indicator That Has Returned to Financial Crisis Levels Bonds and Yen Starting to Lose Safety Appeal? The stock market has got the majority of the attention in the last couple of weeks because of its exceptional volatility. On the other hand,... READ MORE
* Revisiting the February 29 Hammer * Hammering a Top for COVID-19 Revisiting the February 29 Hammer On Friday, 29 February, I pointed out that the Wilshire 5,000 had formed a bullish hammer at a time when a couple of other short-term indicators had reached extreme levels, thereby suggesting a rally.... READ MORE
NASDAQ HOLDS 200-DAY LINE... Let's start with some good news. Heading into the close yesterday afternoon (Friday), stocks were under heavy selling pressure. And the Nasdaq Composite Index was in danger of closing below its 200-day moving average for the first time since last spring. A late stock... READ MORE
RETEST OF LAST WEEK'S LOWS APPEARS LIKELY... Another day of heavy selling has marked the end of this week's rebound, and a likely retest of last week's lows. Another plunge in bond yields to record lows and a 10% plunge in the price of... READ MORE
BANKS AND AIRLINES HIT NEW LOWS... Another record low in bond yields and a continuing flight to the safety of bonds (and gold) are helping put stock prices under heavy selling pressure today. The biggest sector losers are financials, energy, industrials, and cyclicals. It's not hard to understand... READ MORE
* Shanghai is Outperforming the US * Interesting Chinese Sectors Shanghai is Outperforming the US Back in early January, I drew your attention to the fact that the Shanghai Composite ($SSEC) had broken to the upside, which is shown in Chart 1. A week or so later, when the coronavirus reared its... READ MORE
SHORT-TERM STOCK REBOUND CONTINUES... Extremely oversold readings on daily charts at the end of last week, combined with chart support near the October low, increased odds for a rebound in stocks this week. Stocks are rebounding today after yesterday's selloff. And are building on gains that started on... READ MORE
VERY OVERSOLD BUT NO REBOUND YET... After this week's stock plunge, it's not surprising to see short-term momentum and sentiment indicators reach very oversold conditions. That doesn't guarantee a short-term bottom; but does increase the technical odds for one. And even if one does... READ MORE
VIX CLOSES AT HIGHEST LEVEL IN TWO YEARS... Stocks sold off hard again today with more 200-day moving averages being broken. The inability of stock indexes to offer any buying near those long-term support lines is a very discouraging sign. So was today's large jump in the CBOE... READ MORE
S&P 500 APPEARS HEADED TOWARD 200-DAY AVERAGE... An early rebound attempt faded today and the Dow and S&P 500 ended the day lower. Only the Nasdaq managed to hold onto a small gain. The Dow Industrials closed below their 200-day average for the second day in... READ MORE
* Some Signs of Weakness * On a More Bullish Note * Mind that Gap and Volatility Last time I wrote about the stock market was the first week in February, where I concluded that a couple of indicators were oversold, but that many others were not, so further corrective action probably lay... READ MORE
MARKET ROUT CONTINUES... Stocks tumbled for the second day in a row and in heavy trading once again. And important support levels are being broken. The S&P 500 and Nasdaq fell below their January lows today and further below their 50-day averages in pretty decisive fashion. Charts 1... READ MORE
GLOBAL STOCKS PLUNGE ON CORONAVIRUS SPREAD... Recent technical warnings that global stocks were vulnerable to more selling became a harsh reality today. And in a big way. Global stocks fell the most in nearly a year. Selling started in Asia and Europe before spreading to the states. And a lot... READ MORE
GLOBAL STOCKS LOOK OVER-EXTENDED AND VULNERABLE... A number of recent messages have shown charts suggesting that the U.S. stock market looks overbought on the upside and vulnerable to some profit-taking. Not necessarily a major top, but a correction of some sort. Foreign stocks look even more vulnerable. And what... READ MORE
GOLD MINERS ETF NEARS UPSIDE BREAKOUT... With gold surging again today to another seven-year high, gold miners are having an even stronger day percentage-wise. And are nearing a major upside breakout. Chart 1 shows the VanEck Gold Miners ETF (GDX) trading 3% higher today and nearing a challenge of its... READ MORE
U.S. DOLLAR INDEX BREAKS OUT TO THE UPSIDE... The strong rally that started in the dollar in January passed another technical milestone this week. The daily bars in Chart 1 show the U.S. Dollar Index rising above its September/October peaks in yesterday's trading to reach... READ MORE
* Secular Trend for the 20-Year Yield * Lower Down Curve Yields Are Already in a Secular Bull * Short-Term Oscillators Ready for Some Upside Action? The coronavirus has triggered concerns about the recovery, which in turn has resulted in a sharp setback for yields. Falling yields are bullish for housing starts, which,... READ MORE
GOLD RESUMES UPTREND... My weekend message explained why falling bond yields, and an over-extended stock market, might be two of the reasons that investors have been buying gold since the start of the year. And they're doing so in the face of a rising dollar. The message also... READ MORE
RELATIONSHIP BETWEEN GOLD AND THE DOLLAR... Last weekend's message explained that one of the side-effects of a rising U.S dollar is weaker commodity prices. And that's been the case so far this year as a four-month high in the U.S. Dollar Index has pushed... READ MORE
10-YEAR TREASURY YIELD CONTINUES TO WEAKEN... Treasury yields are down again today, and are losing some of the gains made over the last two weeks. The daily bars in Chart 1 show the 10-Year Treasury Yield losing 3 basis points today to 1.58%. The pennant-like shape of its sideways... READ MORE
* Where Are We in the Cycle? * The Economy is Currently on the Side of the Bulls * The Technical Position of the DB Commodity ETF is Precarious Where Are We in the Cycle? Back in December, I wrote an articlepointing out that the business cycle was nothing more than a set... READ MORE
MARKETS LOOKING BEYOND CORONAVIRUS THREAT... Price action of the global financial markets over the past week strongly suggest that fears of the coronavirus are fading.Major U.S. stock indexes are trading at new records. Foreign stocks are being led higher by Asian emerging markets, with help from China. Crude... READ MORE
US DOLLAR INDEX TURNS UP... My Thursday message showed the Invesco US Dollar Index ETF (UUP) hitting a four month high and challenging its previous peak formed during October. It cleared that barrier on Friday. Chart 1, however, plots the US Dollar Index ($USD) which I prefer using to track... READ MORE
TRAVEL STOCKS UNDER PRESSURE... My Tuesday message showed a number of travel and tourism stock groups with heavy exposure to China finding support near moving average lines; or regaining them. Today's message shows those same groups under pressure again today. Let's start with airlines. Chart 1... READ MORE
DOLLAR INDEX NEARS TEST OF EARLY OCTOBER HIGH...While recent volatility in stocks, commodities, and bonds has received a lot of attention, currency trading has been relatively quiet. But that may be changing. Chart 1 shows the Invesco US Dollar Index (UUP) climbing this week to the highest level in... READ MORE
* Why the Correction Will Likely be Contained * More Corrective Action Likely * One Indicator Flashes a Buy Signal * Conclusion Why the Correction Will Likely be Contained A couple of weeks ago, I wrote that a correction was inevitable, and presented a couple of indicators to suggest that it might be close.... READ MORE
EMERGING ASIA LEADS GLOBAL STOCKS HIGHER...A strong rebound in Asia today is giving a big boost to global stocks. Emerging markets in Asia led the rest of the world lower over the last two weeks. And are leading it higher today. Chart 1 shows the MSCI Asia ex Japan... READ MORE
GLOBAL STOCKS WERE ALREADY STRETCHED TOO FAR...The coronavirus outbreak in China has rattled global markets all over the world, and rightly so. Fears of an economic slowdown in the world's second biggest economy is something to be concerned about. And market reactions certainly suggest that investors are... READ MORE
DOW THREATENS 50-DAY MOVING AVERAGE...Global stocks remain under pressure. My last message on Wednesday suggested that the continuing drop in bond yields and economically-sensitive commodities put the mid-week stock rebound in doubt. That still remains the case, not just here in the states; but even more so in foreign... READ MORE
BOND YIELDS AND COMMODITIES CONTINUE TO WEAKEN...One of the recent warnings that I wrote about was the drop in bond yields that has taken place since the start of January. Most of that drop in yields took place last week when a flight to the safety of government bonds... READ MORE
* Bond Yields are Just Above Support * Commodities are at Support The stock market was roughed up by the coronavirus earlier in the week, but, under the surface, another battle has been going on -- the one between inflation and deflation, that is, as both yields and commodity prices have run... READ MORE
STOCK INDEXES CONTINUE SELLING THAT STARTED LAST WEEK...The selling of stocks that started late last week intensified today. That shouldn't be too much of a surprise considering all the warnings given by the various markets as described in these messages. They include the plunge in Treasury yields... READ MORE
CONSUMER DISCRETIONARY SPDR PULLED LOWER BY TRAVEL AND ENTERTAINMENT STOCKS... Yesterday's message showed bond yields falling (and bond prices rising) in a flight to the safety of government bonds. And further suggested that fears of the Chinese virus spreading was most likely behind that more defensive tone. Bond... READ MORE
One of the basic laws of technical analysis, which I have learned the hard way, is to be very careful about calling counter-cyclical short-term moves. The primary trend dominates everything. For example, if you are in a bear market and you see a short-term oversold condition, do not assume that... READ MORE
TREASURY BOND YIELDS CONTINUE TO DROP... The drop in Treasury bond yields that started a month ago is continuing. And is nearing a test of some important support levels. The daily bars in Chart 1 show the 30-Year Treasury yield (TYX) having already broken a rising trendline drawn under its... READ MORE
ENERGY STILL IN DECLINE... Despite today's snapback bounce in global stocks, one sector continues to weaken. And that's the energy sector. Chart 1 shows the Energy Sector SPDR (XLE) falling further below its 50- and 200-day moving averages today. And that's in a rising... READ MORE
What is the future going to look like? In this special episode of Real Trading with Larry Williams, Larry presents the general roadmap for each market in 2020. His analysis takes into account the various seasonal influences (e.g. Christmas sales, production schedules, government action, etc.) and cycles (bond forecast,... READ MORE