Aggressive Stock Market Sell Signal Given
Stock-Markets / Stock Markets 2014 Nov 12, 2014 - 05:00 PM GMT
I have been used to the NYSE Hi-lo index offering end-of-day results in the past. Only recently I noticed a change to intra-day information. Based on that, I converted the data to hourly and boy, was I surprised!
This chart clearly shows an unmistakable distribution pattern. This shows massive institutional selling in the after-hours followed by yen-carry ramps just prior to the open that is picked up by the algos and short-covering to boost the NYSE Hi-Lo index higher during daytime hours. The pattern began to weaken on November 3, leaving the top in the Hi-Lo index on October 31. Today we saw the Hi-Lo index open beneath the 50-day Moving Average and Intermediate-term support at 32.18.
The overall pattern sports an Orthodox Broadening Top, suggesting that the Hi-Lo Index must decline to -250.00 or lower (possibly beneath the -477.00 low) before retracing back to the mid-cycle resistance at 178.03.
The decline beneath -21.00 gives us our sell signal in the Hi-Lo.
SPX opened lower, clearly beneath the trendline. Unfortunately, the only close-by signal is the break in the trendline. The 50-day Moving Average is over 60 points lower.
Based on this the Model is giving an aggressive sell signal, subject to a break in the 50-day for confirmation.
VIX broke out of its Ending Diagonal this morning, giving us an aggressive SPX sell signal here as well. Confirmation lies above the 50-day Moving Average at 15.67.
Regards,
Tony
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