Todd Market Forecast Monday July 27, 2015

Posted by Stephen Todd - Todd Market ForecastForecast

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Available Mon- Friday after 6:00 P.M. Eastern, 3:00 Pacific.

DOW                                                   – 128 on 1400 net declines 

NASDAQ COMP                                 – 49 on 1200 net declines

SHORT TERM TREND                         Bearish 

INTERMEDIATE TERM TREND       Bullish 

STOCKS: On Friday, we thought Monday would be higher, but that was before a drop of 8 1/2 % in China which spread to Europe with the German market dropping  2 1/2%. 

Just to put it into perspective, these percentages would result in drops for the Dow of 1400 points and 450 points respectively.        

GOLD:  Gold rallied $8. A severely oversold condition is helping, but I still don’t see a real turn. Perhaps soon.  A dropping dollar is also helping.      

NEXT DAY: Tuesday. Should be higher.     

CHART: Five day RSI for the S&P 500 is now oversold. Moves below 30 frequently are precursors for the initiation of a multi day rally. 

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BOTTOM LINE:  (Trading)

Our intermediate term system is on a buy. No intermediate term positions for now.

 

System 7   We bought the SSO at 65.01. If there are more declines than advances at 3:45 EST on Tuesday, sell at the close.                               

System 8   We are in cash. Stay there.                    

GOLD  We are in cash. Stay there.     

News and fundamentals:  The Dallas Fed Mfg. Survey was minus 4.6%. better than last month’s minus 7.0%. Durable goods orders rose 3.4%, better than the anticipated rise of 3.1%. On Tuesday we get consumer confidence and the Case Shiller home price index.

Interesting Stuff  Crude oil is crashing and in California, where I live, gasoline prices are surging. We have the worst state legislature of the 50 states in my opinion. They don’t care. They think that driving contributes to global warming —– or something.  

TORONTO EXCHAN GE:   Toronto dropped 185 points.      

S&P/TSX VENTURE COMP: The TSX was down 11.       

BONDS:  Bonds keep rising, a flight to quality no doubt.                                                          

THE REST:  The dollar sank sharply. Silver was up slightly. Crude oil is crashing.                  

We’re on a buy for bonds as of June 11.                      

We’re on a sell for the dollar and a buy for the euro as of July 21.                          

We’re on a sell for gold as of  July 2.                         

We’re on a sell for silver as of June 23.                        

We’re on a sell for crude oil as of July 16.                             

We’re on a sell for the Toronto Stock Exchange as of May 6.    

We’re on a sell for the S&P\TSX Venture Fund as of October 30, 2014.    

We are on a long term buy signal for the markets of the U.S., Canada, Britain, Germany and France.  

Fri.

Mon.

Tue.

Wed.

Thu.

Fri.

Mon.

Evaluation

Monetary conditions

+

+

+

+

+

+

+

+

5 day RSI S&P 500

77

85

63

56

51

25

20

+

5 day RSI NASDAQ

84

78

79

61

41

35

26

+

McCl-

lAN OSC.

+82

+20

-9

-31

-77

-130

-173

+

Composite Gauge

11

12

11

11

15

17

16

+

Comp. Gauge, 5 day m.a.

7.4

9.2

10.0

10.2

12.0

13.2

14.0

+

CBOE Put Call Ratio

.84

.91

.93

.85

1.03

1.39

1.21

+

VIX

11.95

12.25

12.22

12.12

12.64

13.74

15.60

0

VIX % change

-1

+3

0

-1

+4

+9

+14

+

VIX % change 5 day m.a.

-6.2

-2.2

-1.4

-1.4

-1.0

+3.0

+5.2

+

Adv – Dec 3 day m.a.

-116

-275

-877

-753

-770

-1050

-1326

 +

Supply Demand 5 day m.a.

.78

.69

.59

.60

.44

.31

.27

+

Trading Index (TRIN)

1.32

1.12

1.09

.92

1.19

1.54

1.28

 0

S&P 500

2127

2128

2119

2114

2102

2080

2068

Plurality +11

 INDICATOR PARAMETERS

Monetary conditions (+2 means the Fed is actively dropping rates; +1 means a bias toward easing. 0 means neutral, -1 means a bias toward tightening, -2 means actively raising rates). RSI (30 or below is oversold, 80 or above is overbought). McClellan Oscillator ( minus 100 is oversold. Plus 100 is overbought). Composite Gauge (5 or below is negative, 13 or above is positive). Composite Gauge five day m.a. (8.0 or below is overbought. 13.0 or above is oversold). CBOE Put Call Ratio ( .80 or below is a negative. 1.00 or above is a positive). Volatility Index, VIX (low teens bearish, high twenties bullish), VIX % single day change. + 5 or greater bullish. -5 or less, bearish. VIX % change 5 day m.a. +3.0 or above bullish, -3.0 or below, bearish. Advances minus declines three day m.a.( +500 is bearish. – 500 is bullish). Supply Demand 5 day m.a. (.45 or below is a positive. .80 or above is a negative). Trading Index (TRIN) 1.40 or above bullish. No level for bearish.

      No guarantees are made. Traders can and do lose money. The publisher may take positions in recommended securities.