Market Pulse
Author: Created: 3/10/2010 11:54 AM
Market Pulse
By Walter Murphy on 10/26/2012 3:36 PM
On Thursday, the S&P 500 rallied for only the second time in six days with a gain of 0.3%. Advancing stocks exceeded losers by 7:4 while the up/down volume ratio was bullish by a more modest 6:5 margin. Turnover increased by 3%. The daily Coppock Curve has a bearish bias for 20 of the 24 S&P industry groups and for 23 of the 30 DJIA stocks.

The MSCI All-Country Index gained 0.3%. The Coppock Curve has a bearish bias for 27 of the 35 non-US markets that we follow on a daily basis.

The decline since the early October peak has been an orderly trend. There have been few if any overlaps; short term rallies have tended remain well below previous rally attempts. However, over the course of the past few days the orderly downtrend has become choppy with a noticeable increase in overlaps.

Over those same few days, hourly momentum has steadfastly refused to confirm new lows. In addition, there have been modest, initial signs of improvement in the daily oscillators. For example, the daily Coppock Curve...
By Walter Murphy on 10/25/2012 6:52 PM
On Wednesday, the S&P 500 recorded its fourth decline in five days with a loss of 0.3%. Declining stocks exceeded winners by 7:5 while the up/down volume ratio was bearish by a more robust 2:1 margin. Turnover fell by 6.18% (!). The daily Coppock Curve has a bearish bias for 23 of the 24 S&P industry groups and for 25 of the 30 DJIA stocks.

In Wednesday’s action both the S&P 500 and DJIA recorded a lower high and a lower low versus Tuesday’s trading. At the same time, it is fairly easy to count five waves down from last Thursday’s high and the hourly momentum charts have not confirmed the most recent reaction lows. Meanwhile, the NASDAQ and the Wilshire 5000 (as well as the S&P 600 small cap index) recorded a higher high and a higher low compared to the prior day’s activity. All and all, these positive divergences and the maturity of the count suggest that the S&P is close to a relief rally.

Nonetheless, the trend is down. And, if we are correct about the intermediate pressures, the trend will remain...
By Walter Murphy on 10/24/2012 3:14 PM
On Tuesday, the S&P 500 recorded its second sharp decline in three days. The day’s 1.4% loss followed Friday’s 1.7% setback (separated by Monday’s paltry 0.04% gain). Declining stocks exceeded winners by 15:4 but the bearish up/down volume ratio was twice that at 15:2. The day’s distribution qualities were confirmed with a 12% increase in turnover back above the 21-dma. The daily Coppock Curve has a bearish bias for 22 of the 24 S&P industry groups and for 23 of the 30 DJIA stocks.

The MSCI All-Country Index had its biggest loss in three months with a decline of 1.5%. The Coppock Curve has a bearish bias for 31 of the 35 non-US markets that we follow on a daily basis.

There are several factors that are worth pndering related to the current decline. For example, it is the first downtrend on the weekly chart since the June low and it has decisively penetrated the post-June support trend line. However, the trend on the monthly chart is still up, both sentiment and deteriorating weekly momentum are still...
By Walter Murphy on 10/22/2012 12:16 PM
“Plain English”

US Equities: Within the context of the incomplete “D” wave, the immediate downside risk outweighs the upside potential. There are some short term oversold conditions so a brief reaction rally from Friday’s low is possible. Nonetheless, we continue to believe that short term rallies are – at best – part of an intermediate process.

Global Equities: Intermediate momentum continues to deteriorate for both the MSCI All-Country index and a majority of the 37 markets in our survey. At this point, the weekly Coppock Curve has a bearish bias for 19 of the 37 indexes (compared to two markets six weeks ago). We expect this majority bearish condition to persist into 2013.

Interest Rates: This past summer when we were preparing for an intermediate rally by our global yield index, we also made the case that 10-yields in both Italy and Spain (which are not in the index) would likely buck that trend. Yields fell sharply in both countries. Now, as our index is moving into position for a downside...
By Walter Murphy on 10/19/2012 7:27 AM
On Wednesday, the S&P 500 recorded its third straight gain (and fourth in five days) with a rally of 0.4%. Advancing stocks exceeded losers by 14:5; the up/down volume ratio was bullish by a slightly smaller margin. Turnover increased by only 2.0% but it is also on a three-day winning streak. The daily Coppock Curve has a bullish bias for 19 of the 24 S&P industry groups and for 20 of the 30 DJIA stocks.

The MSCI All-Country Index gained 0.8%. The Coppock Curve has a bullish bias for 27 of the 35 non-US markets that we follow on a daily basis.

We have made the case that the S&P 500’s post-June uptrend is in its late stages. Thus, once the current short term rally from last week’s low runs its course, the subsequent correction will likely be intermediate in scope. Underlying this expectation is the knowledge that sentiment is excessively bullish; from a contrary point of view, this bullish sentiment is another bearish indication.

To a large degree, we rely on our own sentiment index. However,...
By Walter Murphy on 10/18/2012 3:11 PM

Here is the link to the interview I did earlier today. http://watch.bnn.ca/#clip786701

By Walter Murphy on 10/17/2012 2:26 PM
On Tuesday, the S&P 500 had its best day in over a month with a rally of 1.0%. Advancing stocks exceeded losers by a bit less than 4:1 and the up/down volume ratio was bullish by a similar margin. Turnover was little changed. The daily Coppock Curve has a bullish bias for 20 of the 24 S&P industry groups and for 22 of the 30 DJIA stocks.

The MSCI All-Country Index gained 1.2%. The Coppock Curve has a bullish bias for 29 of the 35 non-US markets that we follow on a daily basis.

The major indexes have had a few good days. As mentioned, the S&P had its best rally in over month. This rally has an impulsive look to it and began after a successful test of both important chart support and the post-June support trend line. The rally has also had a constructive impact on the daily Coppock Curve; the oscillator currently has a bullish bias for 380 of the S&P 500’s stocks (and 1061 of the components within the S&P Composite 1500). We can also make a case that the 35-day trading cycle has bottomed. All of this...
By Walter Murphy on 10/15/2012 3:45 PM
“Plain English”

US Equities: The post-June uptrend is on the ropes. There are some short term oversold conditions but whether a coming rally proves to be a final last gasp finish to the post-June uptrend or the first relief rally in a new intermediate downtrend is virtually irrelevant. The next short term peak will have bearish intermediate implications.

Global Equities: The weekly Coppock Curve now has a bearish bias for 25 of 37 individual country indexes. This is the first time that this majority bearish condition has existed since June and we expect it to persist into 2013.

Interest Rates: It seems likely that the next short term top will have bearish intermediate implications. As is the case with equities, a new intermediate downtrend in yields will have the potential to carry into 2013.

Commodities: The PowerShares DB Agriculture Fund (DBA) recorded its fifth loss in six weeks with a decline of 0.8% to 28.91. This weakness was enough to violate the dominant uptrend line and to...
By Walter Murphy on 10/11/2012 2:29 PM
On Wednesday, the S&P 500 recorded its fourth straight decline with a loss of 0.6%. While this is the longest losing streak since late September, it is also the largest four-day loss since July. Declining stocks exceeded winners by a bit less than 7:4 while the up/down volume ratio was bearish by a more robust 5:2 margin. Turnover was little changed and is still below its 21-dma. The daily Coppock Curve has a bearish bias for 16 of the 24 S&P industry groups and for 24 of the 30 DJIA stocks.

The MSCI All-Country Index fell by 0.6%. The Coppock Curve has a bearish bias for 26 of the 35 non-US markets that we follow on a daily basis.

From a momentum perspective, the decline of recent days has put pressure on both the short and medium term trends. For example, the daily Coppock Curve appears positioned to be weak for a majority of the S&P’s 24 industry groups for much of the time over the next two weeks. At the same time, the weekly oscillator is deteriorating and will be hard-pressed to repair the...
By Walter Murphy on 10/10/2012 11:36 AM
On Tuesday, the S&P 500 recorded its third straight decline with a loss of 1.0%. Declining stocks exceeded winners by better than 4:1 while the up/down volume ratio was bearish by a more modest 11:4 margin. Turnover improved by 38% over Monday’s semi-holiday session but is still below its 21-dma. The daily Coppock Curve has a bearish bias for 17 of the 24 S&P industry groups and for 24 of the 30 DJIA stocks.

The MSCI All-Country Index fell by 0.9%. The Coppock Curve has a bearish bias for 26 of the 35 non-US markets that we follow on a daily basis.

The cyclical uptrend from the 2009 low is now 43-months old. By comparison, the 2002-2007 uptrend was in force for 60 months. So, by that metric, one could make the case that the current rally could continue for another 17 months. However, important Fibonacci relationships suggest that potentially important barriers – from the perspective of both price and time – may be much closer.

We have regularly made the case that the rally from March 2009...
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