By Lawrence G. McMillan
What had seemed like a typical correction yesterday has now blossomed into something more serious. Whether the FOMC minutes yesterday are really making people sell stocks (no more government inflation of stock prices), or whether that’s just an excuse doesn’t really matter. The selling is real. $SPX has now pulled back almost all the way to the support area at 1385-1390. It is trying to rally from there. So, even though the selling is heavy, the chart of $SPX remains bullish at this point...
By Lawrence G. McMillan
After a rousing start to the week, with $SPX breaking out to new post- 2008 highs, some selling has set in. To date, the selling has been modest and falls into the category of a "garden variety" correction. However, if support at 1385-1390 on $SPX fails, that would be bearish.
Equity-only put-call ratios remain neutral to slightly bullish. Breadth has been the "weak sister" of indicators for some time. The breadth indicators are currently on sell signals -- the sixth such.
By Lawrence G. McMillan
MORRISTOWN, N.J. (MarketWatch) — Despite the occasional overbought condition, the stock market – as measured by the Standard & Poors 500 Index — continues to plow higher. Considering that support levels keep building up below the market, and that overbought conditions rotate out without any major damage to the bullish market, it is clear that the bulls are still in charge.
By Lawrence G. McMillan
Yesterday seemed to be a typical “Turnaround Tuesday” – an opposite reaction to a strong market move on Monday. In the past, this was a common occurrence, but so far this year there hasn’t been much of anything that would cause the market to decline. So perhaps we are returning to a bit more of a normal, and perhaps more volatile, market. $SPX made a new post-2008 intraday high before closing lower. There is support near 1410, and then stronger support at 1385-1390.
By Lawrence G. McMillan
The market is taking a small breather today after yesterday’s strong bullish move. There doesn’t seem to be anything that would indicate this is more than a normal pause. There is now viable support in the 1385-1390 range for $SPX, which was last week’s low. Furthermore, the 20-day moving average is rising rapidly and is near that level as well.
By Lawrence G. McMillan
The stock market, as measured by $SPX, continued to advance in a narrow low-volatility manner. There is solid support at 1375-1380.
Equity-only put-call ratios continue to trade sideways, in a very back-and-forth manner. As long as they are in this state (and you can see the charts in Figure 2 and 3), we are considering this indicator as being "neutral."
By Lawrence G. McMillan
We have been writing commentary for months now, detailing the steepness of the $VIX futures term structure. But recently, it has risen to levels never seen before in the listed VIX futures markets (volatility derivatives began trading in 2004). In this article, we’ll look at the current situation, compare it to past extremes, discuss appropriate strategies, and see if there is any predictive value to these extremes.
By Lawrence G. McMillan
The bulls aren’t going to find a much better market than this one. Overbought conditions are worked off with minimal — almost “stealth” — corrections. Volatility remains low, while prices continue to rise. Support levels continue to build up along the way. And public opinion remains skeptical or even bearish in certain areas.
By Lawrence G. McMillan
In our daily letters and in last week’s hotline, we have written extensively about the “levitating act” that the stock market was performing. Essentially, it had gone from late December through this past Tuesday, while hovering above a number of standard indicators.
By Lawrence G. McMillan
The stock market decisively broke out to the upside on Tuesday, thereby confirming (in my opinion) that the volatile move we have been talking about would take place on the upside.
The equity-only put-call ratios are wavering around at more or less constant levels and aren't giving any clear signal right now. Market breadth hasn't been particularly great over the past three weeks, although it did revive enough this week to push the breadth indicators back onto buy signals.
