Silver Sample

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divergence-alerts

Sept 26, 2014

 

>> Market Status

The evidence below, to me, holds out a good possibility of a bounce, either here or as the main indices reach their 200-day MAs.  I would not be surprised with range-bound behavior though as negative divergences on Breadth and MACD continue to suggest weakening upwards momentum.

QQQ, SPY, and DIA all hovering on their 50-day MAs and all with MACD Negative Divergences on their weekly charts.

Almost all the indices ended the week with price touching a major moving average which could function as support except IWM and GLD.  Both of those could be at price support as they come down to the bottom of the trading range.  Both also have suffered the Death Cross with the 50-day MA crossing below the 200-day MA and price below both MAs.   On the plus side, IWM has a MACD histogram positive divergence on the daily chart.

TLT making headway back on the upward trend.

No change to the economic indicators.  They are all pointed UP.   Waiting on new consumer confidence numbers Tuesday.

The S&P500 P/E Valuation holding up the base of the bubble zone. 

The Put/Call Ratio headed back to center, making no signal. 

The VIX came almost up to the level where the last pullback ended but is no where near the point where we often find it at the end of a pullback.         

Breadth remains a dangerous situation with an ongoing negative divergence on the McClellan Summation Index.

The corporate/treasury yield spread held up fine.  It's function is similar to a canary in a coal mine - I only worry if it keels over. 

The Divergence Count Indicator (DCI) with enough individual stocks with positive divergences to consider the buying window open.  This indicator should NEVER be used without stop losses!

>> ETF Rotation

Brutal week for EEM ended with that fund falling to the number 2 spot just behind TLT.   IVV still hanging in third place above AGG by about 5%.  

IWM, EFA, and SH all have negative returns for the past 140 trading days. 

The model portfolio currently holds IVV and  TLT -- no change because they are both still in the top half.

The current ETF Rotation rankings are TLT, EEM, IVV/SPY,   AGG, EFA, IWM, and SH.

You can track the rotation standings each night after midnight eastern time on the Rotation Page.

>> MACD Divergences

Sectors

 

No DJ sectors with positive divergences on the weekly charts.

 

Brewers ($DJUSDB) with an exemplary negative divergence on the weekly chart but daily chart shows price sitting on 50-day MA.

 

No ETFs with positive divergences on the weekly charts.

 

Several ETFs with negative divergences on the weekly charts, including transportation IYT but they all had strong days Friday and price at 50-day MA.

Individual Stocks

Still slim pickings for individual stocks with positive divergences on the weekly charts.  ATW had a nice pattern although officially it is only a MACD Histogram positive divergence.   

The place to find the divergences to go with the DCI is the daily chart.  See http://divergence-alerts.com/daily-alerts/

After poking into quite a few daily divergences I didn't find any I'd like to buy however these four I will use as examples in the Platinum video: XOM, GRMN, ZBRA, LF.

Substantial list of individual companies with negative divergences on weekly charts. TAP is the brewer aligning with its negatively diverging sector.

Important Notes:  This email is intended for the education of subscribers only. Please do not forward!  This email is neither a recommendation to buy or sell securities, nor is it personal advice.  Consult a licensed professional for advice about your specific situation.   Copyright 2014 by Own Mountain Trading Company.  All rights reserved.  Please do not forward!

tags:$DJUSDB,QQQ,SPY,DIA,IWM,TLT,IYT,XOM,GRMN,ZBRA,LF,ATW,TAP

 
 

OMTC, PO Box 620427, Woodside CA 94062-0427

In This Issue

> Market Status
> ETF Rotation
> MACD Divergences

Steady State

> Interest rates steady

> Put/Call neutral

> Econ Index UP

> Employment UP

> Consumer UP
> Valuation high normal/ low bubble range

Links

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