5-14-17 Market Commentary



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Market Breadth: With this past week’s market fractional advance, our Bull/Bear Point and Figure Ratio at 1.29 rose from 1.19 last week, advancing within bullish territory. The total count of securities in bullish or bearish patterns decreased to 3134. The count of bearish stocks decreased 5%, while the count of stocks in bullish patterns increased 2%. The Sand 2 Pirls P&F Market Breadth Summary Chart shows us a market now twenty-six weeks in bullish territory. Paid subscribers have access to the OpenOffice Calc data from which the chart is generated.

The well known market breadth indicator, the NASDAQ McClellan Summation Index (NASI) fell 39 points for the fourteenth advance in twenty weeks forming a new top. At a positive 110.45 points, it continues below all eight tops above +100, and it continues above all five bottoms below -100 in the last 3 years. 

Volume Analysis: In this week’s volume analysis, the NASDAQ Composite Index ended in neither Accumulation nor Distribution mode with average daily volume lower than the prior week. In the last two weeks the NASDAQ had four (4) Accumulation days and one  (1) Distribution day. (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.) Last week the NASDAQ ended in neither Accumulation nor Distribution mode on higher average daily volume.

Momentum: Now at 78,92 down from 92.32 last week, the CCI(20) daily Woodie’s CCI(20) daily up trend continues. We wait for the CCI(20) daily to return to the +/-50 range for a valid ZLR (Zero Line Reject) long entry signal.
In Woodie’s CCI trading system, six consecutive bars above or below zero are required for a change of trend. The Weekly CCI(20) of the NASDAQ Composite Index began a Woodie’s up trend fifty-four weeks ago, while the Daily CCI(20) began a Woodie’s up trend twenty-five weeks ago.
The CCI(20) weekly has risen to 138.49 from 135.99 last week. We await the return of the CCI(20) weekly to the +/-50 range for another trade.
Industry Rotation the last two weeks: All of the top five industries are  positive and all of the bottom five are negative. Summary: Gold& Silver, and some tech on top; Oil Services, REITs, Brokers, and some tech on the bottom. Bullish: Oil Services PHLX continues in the bottom five. Semis PHLX and Computer Hardware has entered the top five. Bearish: REITs continues in the bottom five. Networkers has entered the bottom five. Brokers, Comp Tech, and S&P Retail have left the top five. Gold & Silver PHLX has left the bottom five and entered the top five.
Focus this week: From www.acting-man.com  “How To Stick It To Your Banker, The Fed, & The Whole Doggone Fiat Money System“. The following are some key points.

  • With respect to the Fed’s balance sheet, Bernanke remarked that the Fed should cut it from $4.5 trillion to “something in the vicinity of $2.3 to $2.8 trillion.”  What exactly this would achieve Bernanke didn’t say.  As far as we can tell, a balance sheet of $2.8 trillion would still be about 300 percent higher than it was prior to the 2008 financial crisis.

    Bernanke, by all measures, is an absolute lunatic.  He, more than anyone else, is responsible for the utter mess that radical monetary policies have made of the U.S. economy.  He’s the one who dropped the federal funds rate to near zero and inflated the Federal Reserve’s balance sheet by over 450 percent.

    Yet Bernanke walks and talks with no remorse.  He even believes his actions somehow saved the economy.  In truth, his actions impeded the economy’s ability to self-correct and provoked today’s asset and debt bubbles.  However, with the exception of Lehman Brothers, his efforts did succeed in saving the banker’s bacon.

  • How to Stick It to Your Banker, the Federal Reserve, and the Whole Doggone Fiat Money System

    If you already own gold or silver, what follows may seem rather elementary.  But if you’re a wage earner and don’t own any precious metals, and don’t know where to start, here’s a practical, elegant, way for you to stick it to your banker, the Federal Reserve, and the whole doggone fiat money system.

    To be clear, we like to keep things really simple.  Thus, we’ve boiled it all down to a simple, two step approach that just about everyone should be able to carry out:

    Step 1: Go to your nearest ATM and pull out a $20.

    Step 2: Go down the street to your local coin shop and trade your $20 for a 1-ounce silver eagle.

     Congratulations!  What you’ve just done is trade a dubious debt construct (i.e., a Federal Reserve legal tender scrap of fiat scrip) for a debt free, long term store of value.  Do you feel good about your trade?

    A one ounce silver eagle. It even looks good!

    If so, do it again and again. 

–Donald Pirl www.s2pmarketsignal.com

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