Summary
Last week’s call worked out well: higher close with a mild pullback.
For next week we’ve got a mildly bullish signal. In case of a pull-back no more than 2%.
Price Action
[bullish]
- Direction: long term up, intermediate-term up
- Historical ranked volatility: 0.25 – 0.50, bellow mid-point
- Trend-health: long-term trending environment (TSI >1.65) and intermediate trend conditions are high, but lower than 5 days ago.
- Channel: intermediate channel position above mid-point.
- OB/OS: RSI(5)>50 and <75, RSI(10)>50 and <75, intermediate term time stretch in lower quartile.
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Seasonality
[bullish]
Seasonality is bullish for April(K), especially during first week of April.
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Correlation
[bearish]
Correlation (M) among S&P500 members is higher (>0.25) . Short-term we see a decrease in correlation (RSI2<50).
Read more about my correlation related research here.
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Breadth
[bullish]
Market Breadth (N) for top performers is at high absolute levels and decreased over the week.
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Sectors
[bearish]
Sector setup (O) is bearish. The sector leaders are XLI (Industrials) and XLF (Financials).
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Bonds
[positive]
RISK ON for the bond market (P). Generally this is positive for the stock market, especially with a combined setup (BONDS and DIRECTION).
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Once again great job!
Do you use TSI to evaluate the intermediate trend health as well? Do you mind sharing the settings if it is the case?
FYI, I have been using a “anchored” version of the TSI to monitor the variation in health of the trends that are identified by an algo of mine. TSI does a pretty good job to signal early warnings of potential shifts.
Thanks for the inspiration,
Pablo
Hello Pablo,
Thanks for your feedback!
for intermediate term trend health I use something based on the idea of TSI, but ranked using 10day ATR over the last 252 days.
Regards,
Frank Hassler