Market Pulse
Author: Created: 3/10/2010 11:54 AM
Market Pulse
By Walter Murphy on 9/28/2012 10:50 AM
On Thursday, the S&P 500 broke a five-day losing streak with a rally of 1.0%. Advancing stocks exceeded losers by better than 4:1 while the up/down volume ratio was bullish by a more robust 5:1 margin. These constructive statistics are mitigated by the fact that turnover fell by more than 15%. The daily Coppock Curve has a bearish bias for 22 of the 24 S&P industry groups and for 25 of the 30 DJIA stocks.

The MSCI All-Country Index rallied 0.8%. The Coppock Curve has a bearish bias for 34 of the 35 non-US markets that we follow on a daily basis.

The rally from yesterday’s low is marginally higher that we would normally expect for a fourth wave. Moreover, the hourly Coppock oscillator has a bullish bias and is still on the oversold side of neutral. These two conditions suggest that higher rally highs are likely in the days ahead.

However, the hourly Coppock is positioned to peak in the days immediately ahead (arguably by as soon as tomorrow or Monday). At that point, it will join (and possibly...
By Walter Murphy on 9/27/2012 2:57 PM
On Wednesday, the S&P 500 recorded its fifth straight decline with a loss of 0.6%. This is the longest losing streak since July’s six-day string. Declining stocks exceeded winners by 2:1; the up/down volume ratio was bearish by a similar margin. Turnover was little changed from Tuesday’s level. The daily Coppock Curve has a bearish bias for 23 of the 24 S&P industry groups and for 28 of the 30 DJIA stocks.

The MSCI All-Country Index fell 1.3%, which was its largest decline since July. The Coppock Curve has a bearish bias for 30 of the 35 non-US markets that we follow on a daily basis.

Inter-market analysis indicates that global markets are in the early stages of a broad-based decline. As noted, the daily Coppock Curve has a bearish bias for 23 of the 24 S&P industry groups and for 30 of the 35 non-US markets that we most regularly monitor. In addition, oil, the euro, and 10-year yields – all of which tend to correlate well with the S&P – are under pressure.

At this point, the S&P is still...
By Walter Murphy on 9/26/2012 2:25 PM
On Tuesday, the S&P 500 recorded its fourth straight decline with a loss of 1.1%. That is the sharpest decline since June and the longest losing streak since late July, early August. Declining stocks overwhelmed winners by 7:1 while the up/down volume ratio was bearish by an even more robust 9:1 margin. Turnover increased 22% from Monday’s well below average level. The daily Coppock Curve has a bearish bias for 16 of the 24 S&P industry groups and for 23 of the 30 DJIA stocks.

The MSCI All-Country Index fell 0.3%. The Coppock Curve has a bullish bias for 18 of the 35 non-US markets that we follow on a daily basis.

We have been asked to add detail to the recent STR’s outline of the global weekly Coppock Curve configuration. The chart in that comment noted that 35 of the 37 markets are on the overbought side of neutral. By definition, that is an overbought condition. And while many (32) of the markets are currently in a constructive “overbought and improving” condition, most are at risk of soon taking...
By Walter Murphy on 9/24/2012 1:04 PM
“Plain English”

Stocks: The daily Coppock is overbought and deteriorating. At the same time, the weekly oscillator is positioned to peak within the next 2-5 weeks. This combination, together with overbought sentiment and the potential for an imminent 35-day (if not a 20-week) cycle top, suggests that the post-June intermediate rally is in its very late stages.

Rest of the World: As new short term downtrends begin and then run their course, the increasingly fragile intermediate uptrends (which have mostly been in force since early June) are likely to feel the pressure and become susceptible to a reversal.

Interest Rates: Even as global equity markets become increasingly at risk of an intermediate downside reversal, we can make a case that 10-year yields are likely to follow a similar path.

Commodities: Our inclination is to view oil’s weakness as the reversal of a five-wave rally from the late June low. As such, the five-wave June-September rally is likely the first leg of a larger uptrend...
By Walter Murphy on 9/20/2012 1:03 PM
On Wednesday, the S&P 500 gained 0.1%. Advancing stocks edged out losers by 6:5 while the up/down volume ratio was bullish by a more robust 5:3 margin. Turnover was essentially unchanged. The daily Coppock Curve still has a bullish bias for 23 of the 24 S&P industry groups and for 26 of the 30 DJIA stocks.

The MSCI All-Country Index gained 0.3%. The Coppock Curve has a bullish bias for 33 of the 35 non-US markets that we follow on a daily basis.

On a number of occasions we have mentioned that the S&P 500 typically records 2-4 intermediate trend changes during the course of a year. So far this year there have been two – the March-April top and the June-July bottom. The index is now reasonably close to a third trend change – a top. In that regard, the weekly Coppock Curve, which is our guide to the health of intermediate trends, is positioned for an October peak. Since most intermediate trends for the S&P tend to last at least 2-3 months, a pending correction/consolidation should persist into 2013.

...
By Walter Murphy on 9/19/2012 12:49 PM
On Tuesday, the S&P 500 posted its second straight loss with a decline of 0.1%. Declining stocks exceeded winners by 5:3 while the up/down volume ratio was bearish by better than 2:1. Turnover increased by 4%. Despite these bearish statistics, the daily Coppock Curve still has a bullish bias for 22 of the 24 S&P industry groups and for 24 of the 30 DJIA stocks.

The MSCI All-Country Index fell by 0.4%. The Coppock Curve has a bullish bias for 32 of the 35 non-US markets that we follow on a daily basis.

We have been making the case that the daily Coppock Curve is likely to peak before the end of September. That is still the case. Moreover, the weekly oscillator is still positioned for an October peak. This, combined with the excessively optimistic sentiment indicators, suggests that the uptrend from the early June low is coming to an end. In that regard, a coming short term peak will likely have bearish intermediate implications.

At the same time, the post-2009 cyclical bull market (our “D”...
By Walter Murphy on 9/17/2012 2:37 PM
“Plain English”

Stocks: A breakout through 1495 would mean that September’s rally had exceeded the previous July-August uptrend. This, in turn, would imply that the entire post-June rally pattern is extending on a short to medium term basis in much the same way that the rally through 1434.44 has bullish longer term implications.

Rest of the World: Last week, global markets were broadly higher. This may be best reflected by the fact that every one of the 37 markets in our regular survey was higher for the week. This was enough to carry both our daily and weekly global cumulative advance-decline lines to an all-time high.

Interest Rates: Despite the recent strength, sentiment is still only neutral. Moreover, the daily, weekly, and monthly Coppock Curves all have a bullish bias. This combination does much to indicate that the downtrend from the February 2011 peak – and possibly from the March 2010 and June 2007 highs – has been reversed.

Commodities: The equal-weighted Continuous Commodity...
By Walter Murphy on 9/14/2012 11:20 AM
On Thursday, the S&P 500 posted its third straight gain (and fifth in six days) with a rally of 1.6%. Advancing stocks exceeded losers by better than 6:1 while the up/down volume ratio was bullish by better than 10:1. Turnover increased by 26% to its highest level since early June. The daily Coppock Curve has a bullish bias for all 24 S&P industry groups and for 28 of the 30 DJIA stocks.

The MSCI All-Country Index rallied by 0.9%. The Coppock Curve has a bullish bias for 33 of the 35 non-US markets that we follow on a daily basis.

Most – all – of Thursday’s news was centered on the FRB’s decision to undertake a QE3 stimulus program. As most readers know, we subscribe to the idea that the market makes the news, not vice versa. So, in that regard, we would make the case that the recent rally through 1434.44, which indicated that the post-2009 “D” wave is positioned to extend to even higher highs, was a precursor to today’s news.

Nonetheless, today’s action was something of a perfect storm of...
By Walter Murphy on 9/13/2012 1:24 PM
On Wednesday, the S&P 500 posted its fourth gain in five days with a rally of 0.2%. Advancing stocks exceeded losers by 7:4 while the up/down volume ratio was bullish by a slightly more modest 5:3 margin. Turnover increased by 2.0% and remains above its 21-dma. The daily Coppock Curve has a bullish bias for 19 of the 24 S&P industry groups and for 21 of the 30 DJIA stocks.

The MSCI All-Country Index rallied by 0.4%. The Coppock Curve has a bullish bias for 34 of the 35 non-US markets that we follow on a daily basis.

We have regularly made the case that the S&P 500 and WTI crude oil have been highly correlated with one another. Thus, we are intrigued by the fact that the rally in recent days for both appears to a fifth wave. And for both the risk is that these fifth waves can be counted as the final legs of the uptrends from the respective June lows. Similarly, sentiment for both is excessively bullish and each Coppock Curve is positioned to peak in the next 6-7 days or so. All of this implies that...
By Walter Murphy on 9/11/2012 3:34 PM
“Plain English”

Stocks: The NYSE all-issue cumulative a-d line is at an all-time high on both a daily and weekly basis as are the weekly a-d lines for the S&P 500, 400, and 600 indexes. Major tops typically do not occur when breadth measures are confirming new highs in indexes.

Rest of the World: Our global Bullish Percent Index is at 83% and the index’s daily point-and-figure chart is on a “buy.” Similarly, the weekly Coppock Curve has a bullish bias for both the All-Country Index and for 35 of the 37 country indexes. All of this indicates still higher global equity prices in the weeks ahead.

Interest Rates: The daily Coppock Curve is bottoming and Fibonacci support has held. This combination suggests that recent weakness is ending.

Commodities: Gold’s daily Coppock Curve is at its best level in seven months and the weekly oscillator is at its highest level of the year. Higher highs seem likely.

US Dollar: As the dollar index was breaking down from a top formation, the euro...
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