Systematic Trading Strategies and Next Level Trading Setups
Stocks surged from mid March to early April and this created short-term overbought conditions for SPY, XLK and QQQ. Large-cap tech and high-quality stocks led the rally. Small-caps and high-beta stocks lagged the market during this advance, but
The Composite Breadth Model is bullish and at +5, but I would characterize this as a fragile +5. Today’s video will dive into the five inputs that make up the model and show why the +5 looks fragile. SPY and QQQ are in uptrends and continue to lead, but the equal-weight S&P 500 and IWM are in downtrends
It remains a tale of two markets. Large-caps and large-cap techs are leading, while small-caps are lagging. The chart below shows QQQ exceeding its early March high in mid March and SPY exceeding this high last week. IWM remains some 7% below this high. The performance differentials since March 1st are also large. QQQ is up 9%, SPY
The stock market is mixed, very mixed. The tape is bearish because the Composite Breadth Model is negative, but large-caps are holding up because the 5-day SMA for the S&P 500 is above the 200-day SMA. Yield spreads remain elevated and show stress
Strength in the stock market is narrow, which means a handful of stocks are keeping the market afloat. Put another way, weakness within the stock market is broad-based, which means the majority of stocks are under pressure. We can see this in the breadth indicators and the small-cap ETFs. SPY and QQQ are
The market went through some serious rotations over the last few months. The Finance sector led the market off the October low and then fell apart over the last four weeks. Healthcare and the defensive groups led the market from early October to
Recent events in the banking world jolted stocks. This jolt was enough to push the Composite Breadth Model into negative territory and widen yield spreads. The Regional Bank
The S&P 500 SPDR (SPY) fell back to its 200-day SMA in February and then surged with a sharp advance the last few days. This advance triggered breakouts in several ETFs that were featured in last week’s report and video. Today’s report will update these charts and set the
February has been a tough month for stocks and the vast majority of ETFs. The S&P 500 peaked on February 2nd and is down around 4.6% the last 16 days. All sector SPDRs are down over this period with
Broad market timing is important because the state of the stock market is the single biggest influence on stocks and stock-based ETFs. The odds are in our favor during bull markets and stacked against us during bear markets.
Stocks surged in January and then moved into pullback mode here in February. As such, many ETFs formed falling flags, falling wedges or other short-term corrective patterns over the last three weeks. This includes the big three: SPY, QQQ and IWM. The market is in corrective mode as long as
The weight of the evidence remains bullish for stocks, but rates are rising again and stock market volatility is above average. Rising rates are putting a bid in the Dollar and weighing on gold. Tech, housing and retail related
The stock market moved from a defensive and risk-off bias in 2022 to an offensive and risk-on bias in 2023. Tech, high-beta and consumer discretionary ETFs are leading in 2023 with some of the biggest moves year-to-date. Many became overbought in early
High-beta and risk-on ETFs are leading the market here in 2023 with big surges the last five weeks. Many triggered bullish trend signals, but they are also short-term overbought and ripe for a rest. Conversely, low-beta
Stocks surged in January and this surge pushed the Composite Breadth Model to a make or break level. The same goes for SPY and QQQ. The CMB was very close to turning bullish last week, while SPY and QQQ were close to breaking above their resistance zones
2023 is starting with a bang as the high-beta groups outperform. High-beta groups are the same as risk-on groups and offensive groups. The 2022 leaders,
The stock market is quite mixed at the moment. The Composite Breadth Model is negative and the 5-day SMA for the S&P 500 is below the 200-day SMA. The percentage of stocks above the 200-day SMA indicators, however, are showing strength within the broader market because they are above 50%. SPY is nearing a moment
Stocks, bonds, the Euro and metals started the year with a bang. The S&P 500 SPDR (SPY) surged 2.3% on Friday and is up 1.42% year-to-date. The 20+ Yr Treasury Bond ETF is outperforming SPY with a 6.2% advance and the DB Base Metals ETF surged over
Today’s report will cover some seasonal patterns at work in the stock market. The Santa Claus Rally just ended on Wednesday and the eight day turn-of-the-month ends on Friday. Historically, these are short-term bullish periods. The fourth
We start the New Year with a negative Composite Breadth Model and bear market environment. 2022 was the year of the whipsaw and largely a year to forget. Nobody knows that 2023 will bring, but the bear market environment indicate that risk remains above average for
