Market Pulse
Author: Created: 3/10/2010 11:54 AM
Market Pulse
By Walter Murphy on 5/28/2013 3:37 PM
“Plain English”

US Equities: A decline back below 1636 during the coming week will lock in the rally from the mid-April cycle low as a complete pattern. Since the post-April uptrend is viewed as the fifth and final wave from November’s low, a breach of 1636 would also satisfy the minimum requirements for a complete post-November uptrend; further weakness though 1581 would confirm the reversal.

Global Equities: An examination of the charts for China, Japan, Germany, and Brazil shows that all four indexes are in some form of an ABC bear market rally of at least intermediate degree. Thus, at least three of the four (China is a possible exception) appear susceptible to a test of their 2011-2012 lows once their current multi-month ABC rallies run their course.

Interest Rates: Both the primary and intermediate uptrends should be in harmony until well into the third quarter. We will, however, be alert to the possibility that the next intermediate top will have bearish longer term implications.

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By Walter Murphy on 5/24/2013 6:39 PM
The S&P 500 fell 0.3% on Thursday, marking its first two-day losing streak since the mid-April cycle low. During the day it had been down by as much as 1.1%. Declining stocks exceeded winners by 5:4 while the up/down volume ratio was bearish by a more robust 3:2 margin. The bearish pressures were mitigated somewhat by a 12% decline in turnover. The daily Coppock Curve has a bearish bias for 23 of the 24 S&P industry groups and for 22 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index fell 2.4%. This was its largest decline since last July, and reversed the uptrend from the mid-April low. The daily Coppock Curve continues to have a bearish bias for a large majority of the 35 markets that we most regularly follow on a daily basis.

As can be seen from the above, the S&P came out of yesterday relatively unscathed compared to global markets. Nonetheless, the “500” appears to be on the verge of completing its post-November rally. From a pure Elliott Wave perspective, our preferred count is that...
By Walter Murphy on 5/24/2013 4:37 AM
The S&P 500 fell 0.8% on Wednesday, which was is its biggest decline since May 1. More importantly, the day’s range was 2.3% with the high occurring early in the day. This action is indicative of a reversal day. Declining stocks exceeded winners by almost 7:1 while the up/down volume ratio was bearish by a more modest 4:3 margin. The bearish pressures were exacerbated by a 24% increase in turnover. The daily Coppock Curve has a bearish bias for 21 of the 24 S&P industry groups and for 22 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index fell 0.1%. Internally, however, 24 of the 35 markets that we most regularly follow on a daily basis were higher. The daily Coppock Curve has a bearish bias for 20 of the 35 markets.

Japan’s Nikkei 225 is down over 7% as this is being written. (Other global markets are lower by about 2%.) If this holds, it will be the Nikkei’s largest decline since the March 2011 10.6% sell-off (which proved to be a multi-year low. While this decline has already broken the...
By Walter Murphy on 5/22/2013 3:16 PM
The S&P 500 gained 0.2% on Tuesday. Advancing stocks edged out losers by 15:14 while the up/down volume ratio was bearish by a slightly more modest 17:16 margin. Turnover increased by 7%. The daily Coppock Curve has a bullish bias for 12 of the 24 S&P industry groups and for 15 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index gained 0.1%. Internally, 20 of the 35 markets that we most regularly follow on a daily basis were higher. The daily Coppock Curve has a bearish bias for 23 of the 35 markets.

We regularly mention that, as long as breadth as measured by the NYSE daily cumulative a-d line continues to make new highs along with the major averages, it is unlikely that the market will experience a major top. Another breadth/ momentum indicator is the Bullish Percent Index (BPI), which is calculated by dividing the number of stocks that are trading on a Point and Figure (P&F) buy signal by the total number of stocks within the index being analyzed. On Monday, the BPI for the S&P 500 hit 90%....
By Walter Murphy on 5/20/2013 3:31 PM
US Equities: There is a strong similarity between the 2002-2007 {B}-wave and the current 2009-2013 {D}-wave. The similarity has been particularly striking since the early 2011 peak. Overlaps are apparent in both and the larger degree inflection points are, with some exceptions, in reasonable harmony. As a result, we think it is still safe to say that this time is not different and it is important to continue to differentiate structure versus strength.

Global Equities: Regardless of how we count the Dow Jones Global (ex US) Index’s 2009-2011 pattern, the current uptrend from the September 2011 low is best viewed as a bear market rally. This suggests that it will be fully retraced.

Interest Rates: It seems likely that the new (C)-wave rally will have the opportunity to decisively break above March’s 2.09% high and arguably challenge 2.31%-2.41%.

Commodities: The expectation for further (C)-wave weakness is buttressed by the fact that both the monthly and quarterly oscillators are weak for a...
By Walter Murphy on 5/17/2013 3:38 PM
The S&P 500 broke a four-day winning streak on Thursday with a loss of 0.5%. Declining stocks exceeded winners by 9:4 while the up/down volume ratio was bearish by a slightly more robust 7:3 margin. Turnover fell by 5%. The daily Coppock Curve still has a bullish bias for 14 of the 24 S&P industry groups and for 19 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index posted its third straight gain with a rally of 0.2%. Internally, however, 24 of the 35 markets that we most regularly follow on a daily basis were lower. The daily Coppock Curve has a bearish bias for 21 of the 35 markets.

There is not much to add to recent comments relative to the US equity market. Thursday’s action had virtually no impact on either the bullish or bearish underpinnings. So, as we look at other asset classes, it is important to note that the US dollar is on the verge of piercing its July 2012 high. We have put some significance on that peak, viewing it as a potentially significant intermediate (B)-wave. The fact...
By Walter Murphy on 5/16/2013 3:00 PM
The S&P 500 gained 0.5% on Wednesday. This was its fourth straight gain – and ninth in the last 10 sessions. As a result, the index again achieved all-time highs on both an intra-day and closing basis. Advancing stocks exceeded losers by 9:5 while the up/down volume ratio was bullish by a more robust 2:1 margin. Turnover increased by 6%. The daily Coppock Curve has a bullish bias for 17 of the 24 S&P industry groups and for 22 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index rallied by less than 0.1%. Internally, 28 of the 35 markets that we most regularly follow on a daily basis were higher, but the daily Coppock Curve has a bearish bias for 21 of the 35 markets.

The rally of just the past several days has carried both the S&P 500 and some important indicators through significant benchmarks, thereby invigorating the dominant uptrend. For example, the number of common stocks hitting a new 52-week high hit levels not seen since April 2010. The Bullish Percent Index for the broad S&P 1500...
By Walter Murphy on 5/14/2013 5:37 PM
Last week, the S&P 500 gained 1.2%; so far this year, the index has only had four down weeks. Perhaps more impressively, the bellwether DJIA (which gained 1.0% last week) has recorded a higher high during 17 of the 19 weeks this year – and eight of those have been all-time highs. Advancing NYSE issues exceeded losers by 7:4 for the week, while the up/down volume ratio was bullish by a slightly more modest 5:3 margin. Average daily composite volume fell 4% to the fourth lowest level of the year. The weekly Coppock Curve has a bullish bias for 14 of the 24 S&P industry groups and for 16 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index rallied by 0.7%. The weekly Coppock Curve has a bullish bias for 20 of the 37 markets that we most regularly follow on a weekly basis.

On several occasions recently, we noted that the daily Coppock Curve was on the verge of running its string of days at or above its neutral “zero” line to the longest since 1995. This breakout in time was accomplished on Friday...
By Walter Murphy on 5/10/2013 3:07 PM
On Thursday, the S&P 500 broke a five-day winning streak with a loss of 0.4%. This just-completed winning streak was the fourth such string of at least five-straight gains this year. By contrast, there has only been one losing streak of more than two days. Declining stocks exceeded winners by 7:3, but the up/down volume ratio was bullish by a more modest 15:8 margin. Turnover fell 4%. The daily Coppock Curve has a bullish bias for 18 of the 24 S&P industry groups and for 18 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index fell 1.1%. The daily Coppock Curve has a bullish bias for 27 of the 35 markets that we most regularly follow on a daily basis.

There was a fair amount of chatter in the financial press about today’s dollar strength, particularly against the Japanese yen. From our perspective, that breakout is fairly important. Both USD/JPY and the Nikkei 225 have been on a tear in recent weeks. Regardless of the causal relationship between the two, we have been counting the dollar’s April...
By Walter Murphy on 5/9/2013 3:33 PM
On Wednesday, the S&P 500 recorded its fifth straight gain with a rally of 0.4%. Advancing stocks exceeded losers by a bit more than 2:1, while the up/down volume ratio was bullish by a more robust 9:4 margin. Turnover increased by 8%. The daily Coppock Curve has a bullish bias for 18 of the 24 S&P industry groups and for 20 of the 30 DJIA stocks.

The Dow Jones Global (ex US) Index rallied by 1.1%, which is its best performance in three weeks. The daily Coppock Curve has a bullish bias for 34 of the 35 markets that we most regularly follow on a daily basis.

On Tuesday, the DJIA’s Bullish Percent Index reached 96.67%. As defined in our website’s glossary, the Bullish Percent Index (BPI or BP) is a breadth/momentum indicator that is most commonly calculated by dividing the number of stocks that are trading on a Point and Figure (P&F) buy signal by the total number of stocks within the group being analyzed. In the present case this means that 29 of the 30 stocks...
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