Support At SPX 3500 Holds

SGS Market Timer Status:  SHORT 
SHORT as of the close of Friday March 10, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data 
Why Market Timing Is A Must

According to an analysis by Economic Policy Institute, price hikes by corporations were the largest contributing factor (50%) to year over year inflation in 2022.  Other contributing factors were labor (20%) and pandemic related supply shortages (30%).  So if price gouging and greed by big corporations is at the heart of the current inflation, then how raising interest rates is to bring inflation down?  At best it would reduce labor costs for companies as workers lose their jobs and have to settle for the same jobs at lower wages.  Maybe that is precisely the Fed's aim and their plan to bring the labor inflation down to "2%" by slowing down the economy and increasing unemployment.  It seems the Fed couldn't care less about how much more we're paying for gas, eggs, meat, etc. all due to price gouging by companies.

Regardless of how the Fed manages to land the economy, corporations via price gouging will continue to post record profits in 2023.  Equity prices for major companies will go higher and indices will turn and start to rally, increasing the likelihood that  the support at SPX 3500 holds this year.

SGS Market Timer

As of the close of last Friday (3/17), the value of SGS was calculated to be -491.  The status of SGS remains SHORT.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.

My Plan

Per my plan I closed all my long positions (except for the two severely underwater and luckily small crypto positions) last Friday.  My plan is to stay in cash for now and see how the current banking crisis settles.

Current Long-Term Portfolio

Past Long-Term Portfolios

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SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.                 

Alarms Are Ringing

SGS Market Timer Status:  SHORT 
SHORT as of the close of Friday March 10, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data 
Why Market Timing Is A Must

Alarms are ringing loudly this weekend in the Federal Reserve building in Washington DC as the Fed wonders if the failure of Silicon Valley Bank is the tip of an iceberg of small bank failures across the county.  The Fed's own economics are warning stock and real estate prices could tumble significantly   The Fed is holding an emergency meeting tomorrow. 

At this point, there is a good chance that the Fed announces a 25 BPS rate hike and not a 50 BPS rate hike in the next FOMC meeting on March 22.   Also, the Fed might decide, during their emergency meeting tomorrow, to suspend their QT program or to reduce its size substantially. 

SGS Market Timer

As of the close of last Friday (3/10), the value of SGS was calculated to be -555.  The status of SGS changed from LONG to SHORT.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  Indices are oversold short-term and there is a good chance that we see a short-covering rally early this week.

My Plan

Per my plan I opened a new long position in SMH last Monday.  Now with SGS turning SHORT, my plan is to close my long positions and open a position in SDS sometime early this week. 

 

Current Long-Term Portfolio

Past Long-Term Portfolios

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opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.                

Higher Interest Rates Are Baked-in

SGS Market Timer Status:  LONG 
LONG as of the close of Friday March 3, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data 
Why Market Timing Is A Must

Last week indices rallied despite rising interest rates across the entire debt spectrum. That is bullish and signals that higher interest rates are "baked-in" now, and more importantly, the Fed is limited as to how far they could possibly raise short-term rates.  Currently the market estimates that limit ("terminal rate") to be around 5.5% and that is also baked into equity markets.

SGS Market Timer

As of the close of last Friday (3/3), the value of SGS was calculated to be +82.  The status of SGS changed from SHORT to LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  

My Plan

I kept my long positions and planning to put my remaining cash into SMH sometime this week.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

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opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.               

The Big Worry

SGS Market Timer Status:  SHORT 
SHORT as of the close of Friday February 24, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

The big worry of financial markets, as it was on full display last week when both stocks and bonds sold off substantially, is that the current aggressive rate hike plan by the Fed will balloon the budget deficit. That in turn would force the US Treasury to sell more debt at higher and higher interest rates. In other words, as the Fed raises short-term rates and slows down economic activities, the budget deficit balloons causing longer term rates to go higher. Higher longer term rates (5 years or higher) would also add to the slowdown causing an even higher budget deficit. This cycle could repeat itself until the economy ends up in a deep and prolonged recession during which indices would go substantially lower.

SGS Market Timer

As of the close of last Friday (2/24), the value of SGS was calculated to be -93.  The status of SGS changed from LONG to SHORT.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  SPX is oversold and chances of a sizable short-covering rally is high.

My Plan

Per my plan I did buy XLF (10%) and XLV (10%) last week.  With SGS being SHORT now, I'm watching the daily value of SGS this week to decide to if and when to sell my long positions and move into cash.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

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opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.              

5% And %5

SGS Market Timer Status:  LONG 
LONG as of the close of Friday February 17, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

The only way the Fed could possibly bring inflation down to their target (2%) is to crush the economy and push unemployment rate to somewhere between 8% to 10%. So, are they going to do that? Not likely because raising the Fud funds rate beyond 6% and it keeping there even for a couple of quarters would balloon the budget deficit to over $1.5 trillion in 2024 and over $2.0 trillion in 2025.

Indices are very likely on a new bull leg and will continue going higher because there is a good chance now that the market has accepted the fact that an average inflation rate of 5% and average long-term interest rate of 5% are the new norm. The era of "free money", i.e. under 3% interest rates, is over.

SGS Market Timer

As of the close of last Friday (2/17), the value of SGS was calculated to be +71.  The status of SGS changed from NEUTRAL to LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  

My Plan

I didn't close any of my long positions last week. With SGS changing its status to LONG now, I'm planning to buy XLF (10%) and XLV (10%) sometime this week.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

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opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.             

SGS Market Timer Is NEUTRAL

SGS Market Timer Status:  NEUTRAL 
NEUTRAL as of the close of Friday February 10, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

The recent selling of equity markets, especially NASDAQ, is due to the significant rise in interest rates, such as a 40 basis point (0.4%) rise in the 10-year Treasury note, in the last couple of weeks.

As shown on the chart above, the 10-year Treasury note yield breached its PDL-1 on its weekly chart and closed above it last Friday.  There is a good chance that 10-year Treasury yield continues to go higher and that would signal more selling is ahead for equities.

SGS Market Timer

As of the close of last Friday (2/10), the value of SGS was calculated to be +38.  The status of SGS changed from LONG to NEUTRAL.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  

My Plan

With SGS changing its status to NEUTRAL, I'm planning to close my long positions, except for two small crypto positions, sometime this week.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

twitter
opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.            

SPX 5000 Sometime This Year?

SGS Market Timer Status:  LONG 
LONG as of the close of Friday January 6, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

With full employment and a strong economy, there is a good chance that we see SPX at 5000 or higher sometime this year.

SGS Market Timer

As of the close of last Friday (2/3), the value of SGS was calculated to be +267.  The status of SGS remains LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  SPX is above its PDL-1 and 50 W-SMA.  There is an excellent chance that sometime next week we see SPX trading above its 50% and 61.8% Fib. retracement of its decline from 4818 to 3491.

My Plan

Per my plan I opened new positions in SSO and XLY last Thursday.  I'm planning to open new long positions once there is a weekly close for SPX above its 61.8 Fib retracement (SPX 4320).

Current Long-Term Portfolio

Past Long-Term Portfolios

twitter
opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.            

Extreme Volatility And Chaos Is The New Norm Now

SGS Market Timer Status:  LONG 
LONG as of the close of Friday January 6, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

The influx of millions of new and inexperienced traders using trading apps on their smartphones and commission-free trading platforms in recent years has contributed to the increased volatility and unpredictability seen in major financial market indices. These traders, who have very little or no understanding of the market or the companies whose stocks they are trading, are more likely to make emotional trading decisions, which has lead to large price movements and increased volatility of indices.   In short, extreme volatility and chaos exhibited by major indices in recent months is the new norm now.

SGS Market Timer

As of the close of last Friday (1/27), the value of SGS was calculated to be +183.  The status of SGS remains LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  SPX closed above its PDL-1 last week.  That is bullish and signals higher prices are ahead for major indices.

My Plan

I'm planning to open new long positions in SSO and XYL sometime this week.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

twitter
opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.           

Higher Prices For Indices Are Ahead

SGS Market Timer Status:  LONG 
LONG as of the close of Friday January 6, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

Aging population and a dysfunctional immigration system in the US has brought on shortages of labor in just about every job sector. That was quite evident by the unemployment data that was released last Thursday, confirming again that the US economy is experiencing "full employment". That means the current labor shortage and hence wage inflation ("sticky inflation") is going to be with us for a while. With full employment and moderate inflation going forward for the next couple of years, there is very little chance of a recession; and with no recession on the economic horizon anytime soon, it's very likely that higher prices for indices are ahead.

SGS Market Timer

As of the close of last Friday (1/20), the value of SGS was calculated to be +96.  The status of SGS remains LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  A weekly close above PDL-1 this week would signal a high likelihood of more buying ahead and continuation of the rally.

My Plan

No chance since last week, I'm planning to wait for a weekly close above PDL-1 before opening more new long positions.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

twitter
opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.      

Recession While Full Employment?

SGS Market Timer Status:  LONG 
LONG as of the close of Friday January 6, 2023 
Previous SGS Status

SGS is a Long-Term (weeks to months) Timer
SGS Performance Data (New)
Why Market Timing Is A Must

The top five world's economies, US, China, Japan, Germany, and UK are experiencing "full employment" mostly due to aging population.  A recession while full employment is unlikely.

SGS Market Timer

As of the close of last Friday (1/13), the value of SGS was calculated to be +194.  The status of SGS remains LONG.

S&P 500 Support And Resistance Levels

Support and resistance levels for SPX for this week are shown above.  A weekly close above PDL-1 this week would signal a high likelihood of more buying ahead and continuation of the rally.

My Plan

Per my plan, last Monday I closed my SDS position and opened a new long position in SSO.  I also opened a new long position in IYM last Wednesday and a new long position in IWM last Friday.  I'm planning to wait for a weekly close above PDL-1 before opening more new long positions.

 

Current Long-Term Portfolio

Past Long-Term Portfolios

twitter
opader@gmail.com

SPX: S&P 500 Index    SMA: Simple Moving Average
DJI: Dow Jones Industrial Index    EMA: Exponential Moving Average
DJT: Dow Jones Transportation Index    PDL: Primary Downtrend Line
NAZ: NASDAQ Composite Index    PUL: Primary Uptrend Line
RUT: Russell 2000 Index    ASL: Active Support Line
OEX: S&P 100 Index    ARL: Active Resistance Line
NDX: NASDAQ 100 Index    DTL: Dynamic Trend Line   
TUL: Tentative Uptrend Line   TDL: Tentative Downtrend Line

TLR: Trend Line Resistance   TLS: Trend Line Support

Disclaimer: The views expressed are provided for informational purposes only and should not be construed in any way as investment advice or recommendation.  Furthermore, the opinions expressed may change without notice.