The Bottom Line
Equity markets around the world recorded technical signs of at least the start of a short term correction as of August 21st that is likely to last until mid/late October. Seasonal trades in selected sectors such as gold and energy continue to show encouraging technical traits on the upside while other sectors such as transportation and semiconductors continue to show encouraging technical traits on the downside. A cautious stance in other markets and sectors appears appropriate until the second half of October when upside opportunities are expected to re-appear. (Ed Note: Equity Trends below the Mark Leibovit comment)
Mark Leibovit’s Volume Reversal Buy Signal From Friday
Precious metals came alive today as they exploded higher following Fed Chairman Bernanke’s morning speech at Jackson Hole. He expressed his concerns about the economy, and labor, and reiterated his previous stance that the Fed stands ready to act should conditions continue to soften.
The iShares Silver Trust posted a Positive Leibovit Volume Reversal on Friday, pushing it well above its 200 day moving average, which was a hurdle that had to be overcome should silver have any chance at a sustained uptrend.
The MACD (circled) is in a positive momentum position which bodes well for the continuation of this move higher.
Today certainly looks like a statement day for the silver bulls and we expect higher prices from here.
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Equity Trends
by Don Vialoux continued
Equity Trends
The S&P 500 Index slipped 4.55 points (0.32%) last week. Intermediate trend is up. The bearish key reversal signal on August 21st remains intact. Resistance is at 1,426.68. The Index remains above its 50 and 200 day moving averages, but fell below its 20 day moving average. . Short term momentum indicators continue to trend down.
Percent of S&P 500 stocks trading above their 50 day moving average slipped last week to 71.60% from 73.40%. Percent is intermediate overbought and trending down.
Percent of S&P 500 stocks trading above their 200 day moving average slipped last week to 67.80% from 70.40%. Percent is intermediate overbought and trending down.
The ratio of S&P 500 stocks in an uptrend to a downtrend (i.e. the Up/Down ratio) increased last week to (285/126=) 2.26 from 2.20. Breakouts and breakdowns were quieter than normal. Nineteen S&P 500 stocks broke resistance and nine stocks broke support.
Bullish Percent Index for S&P 500 stocks increased last week to 71.20% from 70.40% and remained above its 15 day moving average. The Index remains intermediate overbought.
The Up/Down ratio for TSX Composite stocks fell last week to (147/79=) 1.86 from 2.07.
Bullish Percent Index for TSX Composite stocks was unchanged last week at 62.60% and remained above its 15 day moving average. The Index remains intermediate overbought.
The TSX Composite Index eased 132.97 points (1.10%) last week. Intermediate trend is up. Resistance has formed at its August 21st high at 12,196.77. The Index remains above its 50 day moving average, but fell below its 20 and 200 day moving averages. Short term momentum indicators have rolled over from overbought levels and are trending down. Strength relative to the S&P 500 Index remains negative, but is showing early signs of change.
Percent of TSX stocks trading above their 50 day moving average fell last week to 61.38% from 72.36%. Percent has rolled over from an intermediate overbought level.
Percent of TSX stocks trading above their 200 day moving average fell last week to 45.53% from 51.63%. Percent has rolled over from an intermediate overbought level.
Ed Note: More Market Charts HERE including Australia, Japan, China, London, Germany, Greece – Also Currencies, Commodities including Precious Metals – a total of 50 charts
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