Review weekly charts: part II

Two weeks ago we reviewed the weekly charts of several indices; see here. We were neutral then as neither the bullish- nor bearish case was proven. We haven’t posted an update since, so question is:  what has happened since?

Before we go to the charts we want to stress although we were AWOL, we -dare we say- nailed the SPX2120 to the day: see here. We then questioned the current rally based on the SPY:TLT ratio: see here; and sent an intra-day email minutes after the SPX 2050 low was struck to inform our premium members our initial target from our “go short/inverse ETF at SPX2110” entry level was reached: see email here. Hence, we’ve been busy as usual. 🙂

That said, how do the weekly charts, two weeks later, look. Simple: worse than last week, and worse than two weeks ago..

The weekly SPX chart below shows price was -again- unable to close the key SPX2100 level and now closed below the green ascending trend line, which we pointed out to our premium members last week. That’s another bearish sign. In addition the TIs are pointing down with an  initial ideal A.I. sell signal (all 3 lines/TIs directtly below price -black, red and purple- moved down this week from >80: red dotted down arrow). The MACD keeps moving down and the money flow index (3rd TI below price) as well after negative divergence two weeks ago. The weekly chart has now support on a weekly close at the upper red line (SPX 2050), followed by the 20w, 50w and 100w at around 2030-2025. A red week next week will give an ideal A.I. sell signal. The prior ideal sell signal happened last in November 2015. We all know what happened since.

Figure 1. SPX weekly chart. Price still below 2100, TIs pointing down, close below green trend line. 

As you know we’ve been following the tech sector close at is has been one of the weaker sectors, and we believe that’s not good for the market in general as tech normally leads rallies. The TIs on the COMPQ are all pointing down, negative divergence remains on the RSI5, and Money Flow Index (top and bottom TI, respectively),with also here an initial ideal A.I. sell signal. Price is right at the lower green trend-line and has now fallen below the blue descending trend line. The possible fake break out we warned off solidified even more this week. A break below the lower green trendline targets 4600 initially.
Figure 2. COMPQ weekly TI chart

The weekly NDX chart looks similar as the COMPQ and SPX: all TIs down, initial A.I sell signal, negative divergences remain and price right at the green trendline. Break/close below both targets 4000 in a heart beat. Price needs to close above the upper blue trendline -4500- to make any upside progress.
Figure 3. NDX weekly TI chart

Last but not least, the weekly NYA chart also looks the same TI-wise as the three charts discussed prior, and remains unable to break over the critical $10,500. One can honestly wonder when that breakout it will happen, as it really needs to happen for any upside and to solidify the bullish case. Also here we can be certain that another down week will usher in confirmed sell signals, meaning a lot more downside can be expected going forward in that case as the last ideal weekly A.I. sell signal was in June 2015.
Figure 4. NYA weekly TI chart

Bottom line: the weekly charts across indices have, per objective analyses, deteriorated again over last week. The Bulls need a serious up week breaking price above long term trendlines and resistance to change these charts in their favor. All the Bears need is one more down week to turn the charts seriously bearish. Hence, we are now 40/60 bullish/bearish.

 

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