Good morning. We've got a new week on tap so let's get started with a review of my key market models/indicators and see where we stand. To review, the primary goal of this exercise is to try and remove any subjective notions about what "should" be happening in the market in an attempt to stay in line with what "is" happening in the markets. So, let's get started.
The State of the Trend
We start our review each week with a look at the "state of the trend." These indicators are designed to give us a feel for the overall health of the current short- and intermediate-term trend models.
- Although the market has only see two down days, the short-term Trend Model has slipped to neutral.
- The short-term Channel Breakout System remains positive as long as the S&P 500 stays above 2565 this week.
- Although the bears are coming out of the woodwork to proclaim the end is near, the intermediate-term Trend Model is still in good shape.
- The intermediate-term Channel Breakout System remains positive above 2544 this week.
- The long-term Trend Model also remains solidly positive at this time.
- The Cycle Composite points lower again this week before starting to turn higher.
- The Trading Mode models suggest that this remains a trending environment.
The State of Internal Momentum
Next up are the momentum indicators, which are designed to tell us whether there is any "oomph" behind the current trend.
- The short-term Trend and Breadth Confirm Model slipped to negative last week as breadth had been weakening prior to the blue chip indices starting to falter.
- However, the intermediate-term Trend and Breadth Confirm Model continues positive.
- The Industry Health Model didn't ...