Sand 2 Pirls Market Commentary a weekly technical stock market overview featuring our custom Bull/Bear P&F ratio

July 26, 2008

7-25-08 Market Commentary

Filed under: Market Commentary — dlpirl @ 4:32 pm
Subscriber email sent 7-26-08:

Market Breadth: Bears lost a bit more ground this week. Our Bull/Bear Point and Figure ratio rose from 0.32 to 0.40, still strongly in bear territory. There are about 2.5 stocks in bearish P&F patterns for every one in a bullish pattern. The new format Sand 2 Pirls P&F Market Breadth Summary Chart now shows us market that may be making a bearish bottom, although bulls are not yet showing the strength needed to turn the tables. Last week the total count of securities in Bullish or Bearish patterns decreased by 15% to under 1300. Bearish patterns decreased by 20%, while Bullish patterns increased by 2%. Paid subscribers have access to the Excel data from which the image to the left is built.

The well known market breadth indicator, the Nasdaq McClellan Summation Index (NASI) increased for the fourth time in ten weeks and with a rise of 221 points. At -861, it appears to have made at least an intermediate bottom, and has risen above the January 2008, April 2007, and November 2007 lows, but is still below the October 2005, July 2006, August 2007, and March 2008 lows.
The Nasdaq Composite Index has a count of four (4) accumulation days and one (1) distribution day in the last two weeks and is currently in neither accumulation nor distribution mode. Last week it also ended in neither accumulation nor distribution mode. (Accumulation days are counted when the index closes up on higher volume than the prior day while distribution days occur when the index closes down on volume higher than the prior market day.) Of the other indexes, again this week as last, the DOW (DIA) ended the week in neither accumulation nor distribution mode while the S&P (SPY) ended in accumulation mode.
Momentum: At close Wednesday 7/23 with CCI(20) above the ZLR pivot point of zero (0), we got an exit signal from the Short trade we entered at Monday’s open. The trade resulted in a loss of 38.46 point on the Nasdaq Composite or $0.58 per share of QQQQ.
In Woodie’s CCI trading system, six consecutive bars above or below zero are required for a change of trend. By this definition, the weekly CCI(20) of the Nasdaq Composite Index began an uptrend eight weeks ago, but now has 5 weeks below zero, while the Daily CCI(20) began a downtrend six weeks ago, and now has one week above zero.
The Nasdaq Composite CCI(20) Weekly pattern has had a total of twelve weeks in a Long trend without giving a Long entry signal and now has five weeks below zero. It continued to rise last week, and is now just above minus 50. A valid Zero Line Reject (ZLR) Long entry signal requires that the CCI(20) decrease the prior week but be above minus 50.
Industry Rotation the last two weeks: Bullish: Airlines (XAL) continues its recovery, Banks BKX), Brokers (BKX), and Networkers (NWX) are in the top five. Oil (XOI), Oil Services (OSX), and Gold & Silver (XAU) are in the bottom five. Semis(SOX) remains out of the bottom five industry groups. Disk Drives (DDX) have left the bottom five. Bearish: None.
2% 3 box reversal P&F of SOX
Focus This Week: With all the industry signs bullish, how is our long time bullish bell-weather index, the Philadelphia Semiconductor doing? Not well! On Friday, it broke recent support. If it can gain upward momentum this week, a bottom may be forming to the current bear market. If not, downside momentum could accelerate.

–Donald Pirl www.s2pmarketsignal.com

S2P Market Signal Commentary may be freely forwarded and otherwise distributed providing content is unchanged and authorship acknowledged. © 2004 Sand2Pirls, Inc. All rights reserved. [ Terms and Conditions/Disclaimer ]

July 19, 2008

7-18-08 Market Commentary

Filed under: Market Commentary — dlpirl @ 8:08 am
Subscriber email sent 7-19-08:

Market Breadth: Bears lost a bit of ground this week. Our Bull/Bear Point and Figure ratio rose from 0.19 to 0.32, still strongly in bear territory. There are now over three stocks in bearish P&F patterns for every one in a bullish pattern. The new format Sand 2 Pirls P&F Market Breadth Summary Chart now shows us market that may be making a bearish bottom, although bulls are not yet showing the strength needed to turn the tables. Last week the total count of securities in Bullish or Bearish patterns decreased by 18% to just under 1500. Bearish patterns decreased by 25%, while Bullish patterns increased by 22%. Paid subscribers have access to the Excel data from which the image to the left is built.

The well known market breadth indicator, the Nasdaq McClellan Summation Index (NASI) increased for the third time in nine weeks but with a rise of only 1 point. At -1082, it is now below the October 2005, July 2006, August 2007, and March 2008 lows. This week it dropped below the January 2008 low, but ended the week above it.
The Nasdaq Composite Index has a count of three (3) accumulation days and two (2) distribution days in the last two weeks and is currently in neither accumulation nor distribution mode. Last week it ended in distribution mode. (Accumulation days are counted when the index closes up on higher volume than the prior day while distribution days occur when the index closes down on volume higher than the prior market day.) Of the other indexes, the DOW (DIA) ended the week in neither accumulation nor distribution mode while the S&P (SPY) ended in accumulation mode.
Momentum: At close Friday 7/18 with CCI(20) in the -50 to +50 ange, we got a ZLR (Zero Line Reject) Short entry signal for Monday’s open. We will follow this trade simulation in next week’s commentary.
In Woodie’s CCI trading system, six consecutive bars above or below zero are required for a change of trend. By this definition, the weekly CCI(20) of the Nasdaq Composite Index began an uptrend seven weeks ago, while the Daily CCI(20) began a downtrend five weeks ago.
The Nasdaq Composite CCI(20) Weekly pattern has had a total of eleven weeks in a Long trend without giving a Long entry signal and now has four weeks below zero. Although it rose from last week, it continues below minus 50, and a valid Zero Line Reject (ZLR) Long entry signal must find the CCI(20) in the +50 to -50 range.
Industry Rotation the last two weeks: Bearish: Disk Drives (DDX) have entered the bottom five. Bullish: Last week Airlines led the bottom five, this week it leads the top five. Oil (XOI) remains in the bottom five. Gold & Silver (XAU) has left the top five. Brokers (XBD) and Banks (BKX) have entered the top five. Semis (SOX) remains out of the bottom five industry groups.
Focus This Week: Looking at a performance chart of both the US Dollar and Gold, we see that it has been just less than a year since Gold began to rise and the Dollar fall. However, Gold has risen much more than the Dollar has fallen. Gold is currently approaching its highs of about 3 months ago. Will it form a “double top” pattern and begin to decline, or is it just beginning a new wave up? Click the chart above to follow developments in the days and weeks to come.

–Donald Pirl www.s2pmarketsignal.com

S2P Market Signal Commentary may be freely forwarded and otherwise distributed providing content is unchanged and authorship acknowledged. © 2004 Sand2Pirls, Inc. All rights reserved. [ Terms and Conditions/Disclaimer ]

July 12, 2008

7-11-08 Market Commentary

Filed under: Market Commentary — dlpirl @ 3:16 pm
Subscriber email sent 7-12-08:

Market Breadth: Bears continued in control this week. Our Bull/Bear Point and Figure ratio fell very sligtly further into Bear territory from 0.21 to 0.19. There are now over five stocks in bearish P&F patterns for every one in a bullish pattern. The new format Sand 2 Pirls P&F Market Breadth Summary Chart now shows us market that has not yet hit a bearish bottom as bears continue in control. Last week the total count of securities in Bullish or Bearish patterns decreased by 6% to just over 1800. Bearish patterns decreased by 4%, while Bullish patterns decreased by 12%. Paid subscribers have access to the Excel data from which the image to the left is built.

The well known market breadth indicator, the Nasdaq McClellan Summation Index (NASI) decreased for the sixth time in eight weeks with a drop of 183 points. At -1083, it is now below the October 2005, July 2006, August 2007, and March 2008 lows and is very close to the January 2008 low.
The Nasdaq Composite Index has a count of two (2) accumulation days and four (4) distribution days in the last two weeks and is currently in distribution mode. Last week it ended in neither accumulation nor distribution mode. (Accumulation days are counted when the index closes up on higher volume than the prior day while distribution days occur when the index closes down on volume higher than the prior market day.) Of the other indexes, the DOW (DIA) ended the week in distribution mode while teh S&P ended in neither accumulation nor distribution modes.
Momentum: At close this last Tuesday 7/8, when CCI(20) rose above the minus 100 line, we got an exit signal from the trade we began last week at Thursday 6/19 open. This trade gave us a profit of 136.54 on the Nasdaq Composite (not directly tradable) or $1.97 per share of QQQQ.
In Woodie’s CCI trading system, six consecutive bars above or below zero are required for a change of trend. By this definition, the weekly CCI(20) of the Nasdaq Composite Index began an uptrend six weeks ago, while the Daily CCI(20) began a downtrend four weeks ago.
The Nasdaq Composite CCI(20) Weekly pattern has had a total of ten weeks in a Long trend without giving a Long entry signal and now has three weeks below zero. However, it is now below -50, and a valid Zero Line Reject (ZLR) Long entry signal must find the CCI(20) in the +50 to -50 range.
Industry Rotation the last two weeks: Bearish: Gold & Silver (XAU) remain in the top five industry groups although it no longer leads. Brokers (XBD) are in the bottom five. Bullish: Oil (XOI) and Oil Services (OSX) are in the bottom five. Semis (SOX), Brokers (XBD), Banks (BKX), Disk Drives (DDX) remain out of the bottom five industry groups.

–Donald Pirl www.s2pmarketsignal.com

S2P Market Signal Commentary may be freely forwarded and otherwise distributed providing content is unchanged and authorship acknowledged. © 2004 Sand2Pirls, Inc. All rights reserved. [ Terms and Conditions/Disclaimer ]

7-4-08 Market Commentary

Filed under: Market Commentary — dlpirl @ 8:45 am
Subscriber email:

Market Breadth: Although the week was short, market decline continued in an unambiguous fashion. Our Bull/Bear Point and Figure ratio fell further into Bear territory from 0.31 to 0.21. There are now nearly five stocks in bearish P&F patterns for every one in a bullish pattern. The Sand 2 Pirls P&F Market Breadth Summary Chart now shows us market with increasing bearish acceleration after bulls were not able to take control. Last week the total count of securities in Bullish or Bearish patterns increased by over 11% to over 1900. Bearish patterns increased by 20%, while Bullish patterns decreased by 18%. Paid subscribers have access to the Excel data from which the image to the left is built.

The well known market breadth indicator, the Nasdaq McClellan Summation Index (NASI) decreased for the fifth time in seven weeks with a drop of 243 points. At -900, it is now below the October 2005 and and July 2006 lows and is close to the August 2007 low.
The Nasdaq Composite Index has a count of two (2) accumulation days and four (4) distribution days in the last two weeks and is currently in neither accumulation nor distribution mode. Last week it ended in distribution mode. (Accumulation days are counted when the index closes up on higher volume than the prior day while distribution days occur when the index closes down on volume higher than the prior market day.) Of the other indexes, the S&P (SPY) ended the week in accumulation mode while others ended in neither accumulation nor distribution modes.
Momentum: We continue in the trade we began last week at Thursday 6/19 open. The CCI(20) has not risen above the ZLR (Zero Line Reject) pivot point or come back above the minus 100 line once it passed below it. We will continue monitoring this trade simulation in next week’s commentary.
In Woodie’s CCI trading system, six consecutive bars above or below zero are required for a change of trend. By this definition, the weekly CCI(20) of the Nasdaq Composite Index began an uptrend five weeks ago, while the Daily CCI(20) began a downtrend three weeks ago.
The Nasdaq Composite CCI(20) Weekly pattern has had nine weeks above zero without giving a Long entry signal and now has two weeks below zero. However, it is now below -50, and a valid Zero Line Reject (ZLR) Long entry signal must find the CCI(20) in the +50 to -50 range.
Industry Rotation the last two weeks: Bearish: Gold & Silver (XAU) continues to lead the top five industry groups. Disk Drives (DDX) are second in the bottom five. Bullish: Oil Services (OSX) has left the top five. Semis (SOX), Brokers (XBD), and Banks (BKX) have left the bottom five industry groups.

–Donald Pirl www.s2pmarketsignal.com

S2P Market Signal Commentary may be freely forwarded and otherwise distributed providing content is unchanged and authorship acknowledged. © 2004 Sand2Pirls, Inc. All rights reserved. [ Terms and Conditions/Disclaimer ]

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