12-31-17 Market Commentary


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Market Breadth: With this past week’s market advance, our Bull/Bear Point and Figure Ratio at 1.69, was unchanged from 1.69 last week, remaining within bullish territory. The total count of securities in bullish or bearish patterns increased 1% to 3242. The count of bearish stocks increased 1%, while the count of stocks in bullish patterns increased 1%. The Sand 2 Pirls P&F Market Breadth Summary Chart shows us a market now eighteen 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 4 points for the eighth decline in eleven weeks. At a positive 116.69 points, it  continues below all seven tops in the last 30 months, and continues above all five bottoms in the last 30 months. 

Volume Analysis: In this week’s volume analysis, the NASDAQ Composite Index ended in Distribution mode with average daily volume lower than the prior week. In the last two weeks the NASDAQ had one (1) Accumulation day 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 lower average daily volume.

Momentum: At Wednesday 12/6 close, the CCI(20) daily was within the +/- 50 range for a ZLR (Zero Line Reject) pivot and Long entry signal at Thursday 12/7 close. At Fri 12/22 close the CCI(20) fell below +100 to signal our exit from the trade at Tuesday 12/26 open. The result of this trade simulation was a gain of 68.97 points on the NASDAQ or $1.34 per share of QQQ.


The CCI(20) daily in a Woodie’s Up trend is now at +32.31, down from +98.10 last week. The CCI(20) daily is now within the +/-50 range for another ZLR Long entry signal if the CCI(20) daily rises early this week.
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 eighty-seven weeks ago, while the Daily CCI(20) began a Woodie’s up trend sixteen weeks ago.
The CCI(20) weekly at +102.25, is down from +128.92 last week after forming a ZLR (Zero Line Reject) Long entry signal for Tuesday 9/5 open. Our rule is to stay in the trade until the CCI(20) drops below +100. We will continue to follow the result of this trade simulation in next week’s commentary.
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, Oil Services, and Oil on top; REITs and some Tech on the bottom. Bullish: None. Bearish: Gold & Silver PHLX continues in the top five. REITs and Disk Drives continue in the bottom five. Comp Tech and Computer Hardware have entered the bottom five. Oil Services and Oil continue in the top five. S&P Retail has left the top five.
Focus this week: From www.zerohedge.comChart Of The Day – This Hasn’t Happened Since 2008“. Its a simple but powerful article and is copied here in full with charts.

If you want to know what’s swirling around the minds of the American population, just look at Google search trends.

It’s all fun and games “buying the f**king dip” until someone mentions “sell stocks.

Meanwhile, Americans panic search “buy bitcoin.”

The gig-economy as per “Craigslist jobs” has plateaued.

Americans are now resorting to the “Wal-Mart credit card” in a period of wage stagnation.

Americans search for “Goodwill near me” explodes, as their standard of living declines.

Bottomline: The sad story of the new normal for many Americans is being told through their simple searches on Google. 

–Donald Pirl www.s2pmarketsignal.com

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