Commentary: Paul Ebeling on Wall Street
$DIA, $SPY, $QQQ, $VXX
The major US stock market indexes are setups to decides direction near term s noted earlier, the volume last week did not indicate that it was time to sell all stocks into the bounce.
There are some good Northside plays to make money whenthe bids return, and some
Southside if bids do not return.
That raises this point.
When ETF’s began gaining popularity, many believed that was the start of the destruction of the markets as we knew them.
The Big Q: Why?
The Big A: They allow lazy investing, and they do not reflect the moves of the stocks that comprise
the ETF. ETF managers control that action.
Now the next step is working daily, as algorithms running some very large funds and so lots of money, coupled with smaller robot advisors that tell investors what ETF’s to place their money.
Then it is all turned to the machines.
Pay attention to how the machines trade, how they accumulate shares, and then recognize the tracks just as always, regardless of who manages the money.
So, what does the situation on the NAS Comp and S&P 500 show us in here?
This: another break of Key support that could be a false break out South.
Here is what 1 keen observers I read wrote this weekend: “In any event, this is going to lead to the destruction of any real price-finding market.
“When the machines take over most of the action, that will be the day the market ceases to reflect what markets have always shown, e.g. the belief of investors as to the economic future, and will instead
reflect only the reactions of each algorithm and program to the headlines that appear in the news ticker.”
Most of us know how a planned rumor can move a stock, even the market. Now think about what can happen when hundreds, even thousands, of headline-reading programs react to each headline, and then what happens when the ETF’s are then ‘balanced’ at the end of the session to reflect the latest headline.
Fake News can rule.
The often very wrong guru Dennis Gartman cited some very intelligent players last week, as he made the prediction that the long Bull run for stocks is over. He said he realized what kind of damage such a call, if incorrect, could do to an ‘already damaged’ reputation, but he just feels compelled to do it.
The market is ruthless, it takes no prisoners. So never stand in front of a moving train, and always take what the market gives.
Tune out the Noise!
The dollar for dollar moves of all markets are rendered moot.
Remember, pay attention, it is your money and your responsibility.
The Bulls Vs The Bears
VIX: 15.51; -0.53
VXN: 17.77; -1.29
VXO: 12.87; -0.99
Put/Call Ratio (PCR) CBOE: 0.97; +0.04
The Bulls Vs The Bears
The Bulls are at 57.5 Vs 60.0 last
The Bears at 17.0 Vs 16.2 Last
Support and Resistance
DJIA close: 21,858.32
21,681 the Jul 2007 high
22,179 the Aug 2017 all-time high
The 20-Day EMA: 21,836
The 50-Day EMA: 21,574
21,169 the Mar 2017 high
20,553 the May 2017 lows
20,547 the Apr 2017 lows
The 200-Day SMA: 20,484
S&P 500 close: 2441.32
The 50-Day EMA: 2446
2453 the Jun 2017 high
2487 the Mar 2009 uptrend
2439 a Jun 2017 high
2406 the May 2017 high
2401 the Mar 2017 high
2352 the May 2017 low
2348 a Apr 2017 low
The 200-Day SMA: 2339
NAS Comp close 6256.56
The 50-Day EMA: 6263
6300 a Jun 2017 high
6342 a Jun 2017 high
6461 the Jun 2017 high
6205 a May 2017 high
6141 the Y 2016 trendline
5996 the May 2017 low
5937 the Apr 2017 low
5915 the Apr 2017 high
5910 an Apr 2017 low
The 200-Day SMA: 5838
Have a terrific week.