Todd Market Forecast for 3pm Pacific Wednesday November 16 , 2016
DOW – 55 on 100 net advances
NASDAQ COMP + 19 on 150 net advances
SHORT TERM TREND Bullish
INTERMEDIATE TERM Bullish
STOCKS: Today was profit taking after 7 up days in a row for the Dow. We like the fact that it was down on positive breadth.
Crude oil may have influenced trading. It was down on a high inventory number.
It’s tempting to take a long trading position, but it’s a bit too risky right now.
GOLD: Gold was flat. Not much happening even though it is very oversold.
CHART The NASDAQ Composite, like the S&P 500 is overbought and in a congestion zone. Note that when 5 Day RSI becomes overbought (over 70) the index usually drops or goes sideways. That is unless it is in a sustained uptrend like last July. We should soon know if that’s the case. We still have in mind the high put call ratios.
BOTTOM LINE: (Trading)
Our intermediate term system is on a buy.
System 7 We are in cash. Stay there for now.
System 8 We are in cash. Stay there.
News and fundamentals: The PPI-FD rose 0.3%, higher than the expected flat reading. Industrial production rose 0.1%, better than the consensus 0.0%. The home price index came in at 63, in line with expectations. Oil inventories rose 5.3 million barrels, more than last week’s 2.4 million rise.
Interesting Stuff Start by doing what’s necessary; then do what’s possible; and suddenly you are doing the impossible. ——–Francis of Assisi
TORONTO EXCHANGE: Toronto dropped 23
BONDS: Bonds rose for the second day.
THE REST: The dollar continued higher. Silver fell back. Crude oil back off slightly.
Bonds –Bearish as of November 7.
U.S. dollar -Bullish as of November 7.
Euro — Bearish as November 7.
Gold —-Bearish as of November 7.
Silver—- Bearish as of November 7.
Crude oil —- Bullish as of November 15.
Toronto Stock Exchange—- Bullish from January 22.
We are on a long term buy signal for the markets of the U.S., Canada, Britain, Germany and France.
…also Michael Campbell’s Mid-Week Update: On The Brink of Massive Changes
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.