{"id":31523,"date":"2015-11-03T01:41:42","date_gmt":"2015-11-03T09:41:42","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=31523"},"modified":"2015-11-03T01:57:50","modified_gmt":"2015-11-03T09:57:50","slug":"t2108-update-151102","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2015\/11\/03\/t2108-update-151102\/","title":{"rendered":"T2108 Update (November 2, 2015) &#8211; The S&#038;P 500 Stairsteps Ever Higher and STILL Avoids Overbought Status"},"content":{"rendered":"<p><code><\/code>(T2108 measures the percentage of stocks trading above their respective 40-day moving averages [DMAs]. It helps to identify extremes in market sentiment that are likely to reverse. To learn more about it, see my <a href=\"http:\/\/www.drduru.com\/money\/T2108.htm\">T2108 Resource Page<\/a>. You can <a href=\"http:\/\/twitter.com\/#!\/search\/%23T2108\">follow real-time T2108 commentary<\/a> on twitter using the #T2108 hashtag. T2108-related trades and other trades are occasionally posted on twitter using <a href=\"http:\/\/twitter.com\/#!\/search\/%23120trade\" target=\"_blank\">the #120trade hashtag<\/a>. T2107 measures the percentage of stocks trading above their respective 200DMAs)<\/p>\n<p><strong>T2108 Status<\/strong>: 67.5%<br \/>\n<strong>T2107 Status<\/strong>: 36.0% (finally reversed all of its August angst)<br \/>\n<strong>VIX Status<\/strong>: 14.2<br \/>\n<strong>General (Short-term) Trading Call<\/strong>: neutral<br \/>\n<strong>Active T2108 periods<\/strong>: Day #22 over 20%, Day #21 over 30%, Day #21 over 40%, Day #19 over 50%, Day #4 over 60% (overperiod), Day #336 under 70% (underperiod)<\/p>\n<p><strong>Reference Charts<\/strong> (click for view of last 6 months from Stockcharts.com):<br \/>\n<a title=\"6-month chart of the S&amp;P 500\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=$SPX&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p14085208538\" target=\"_blank\">S&amp;P 500<\/a> or <a title=\"6-month chart of SPY\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=SPY&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p14085208538\" target=\"_blank\">SPY<\/a><br \/>\n<a title=\"6-month chart of SDS\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=SDS&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">SDS<\/a> (ProShares UltraShort S&amp;P500)<br \/>\n<a title=\"6-month chart of the U.S. dollar\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=$USD&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p25615696567\" target=\"_blank\">U.S. Dollar Index<\/a> (volatility index)<br \/>\n<a title=\"6-month chart of EEM\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=EEM&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">EEM<\/a> (iShares MSCI Emerging Markets)<br \/>\n<a title=\"6-month chart of the VIX\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=$VIX&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p25615696567\" target=\"_blank\">VIX<\/a> (volatility index)<br \/>\n<a title=\"6-month chart of VXX\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=VXX&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">VXX<\/a> (iPath S&amp;P 500 VIX Short-Term Futures ETN)<br \/>\n<a title=\"6-month chart of EWG\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=EWG&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">EWG<\/a> (iShares MSCI Germany Index Fund)<br \/>\n<a title=\"6-month chart of CAT\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=CAT&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">CAT<\/a> (Caterpillar).<br \/>\n<a title=\"6-month chart of IBB\" href=\"http:\/\/stockcharts.com\/h-sc\/ui?s=IBB&amp;p=D&amp;st=2015-05-02&amp;en=2015-11-02&amp;id=p15880085697\" target=\"_blank\">IBB<\/a> (iShares Nasdaq Biotechnology).<\/p>\n<p><strong>Commentary<\/strong><br \/>\nThe S&#038;P 500 (SPY) started November with another strong showing as the index picks up where it left off with <a href=\"http:\/\/drduru.com\/onetwentytwo\/2015\/11\/01\/extraordinary-month-for-sp500\/\" target=\"_blank\">October&#8217;s extraordinary performance<\/a>. It closed with a 1.2% gain and a level last seen during the heights of August. Incredibly, the index can now see fresh all-time closing highs just over the horizon (2130.82)&#8230;<\/p>\n<p><center><br \/>\n<figure id=\"attachment_31524\" aria-describedby=\"caption-attachment-31524\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_SP500.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_SP500.png\" alt=\"The S&amp;P 500 (SPY) has produced a steady...and very bullish...staircase pattern onward and upward toward fresh all-time highs.\" width=\"550\" height=\"375\" class=\"size-full wp-image-31524\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_SP500.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_SP500-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31524\" class=\"wp-caption-text\">The S&#038;P 500 (SPY) has produced a steady&#8230;and very bullish&#8230;staircase pattern onward and upward toward fresh all-time highs.<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>Despite this strong and bullish breakout, I cannot flip the trading bias from neutral to bias. T2108, my favorite indicator, closed at 67.5%. So it is STILL churning below overbought territory and indicating that the on-going rally is not able to push new stocks over the hump. This churn is closing in on one month in duration. I am patiently waiting to see how the market behaves once this occurs: will the market finally lose momentum and reverse or will it get new life and launch into one of those epic oversold rallies?<\/p>\n<p>T2107, the percentage of stocks trading above their respective 200DMAs, is more interesting. While T2108 has stalled, T2107 has marched along with the S&#038;P 500. It is a slower moving index that has just now reversed all the angst from August. At 36.0%, T2107 is at a 2+ month high. Left in the rearview mirror are a W-bottom and a 50DMA breakout that defines the end of a primary downtrend.<\/p>\n<p><center><br \/>\n<figure id=\"attachment_31537\" aria-describedby=\"caption-attachment-31537\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_T2107.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_T2107.png\" alt=\"The percentage of stocks trading above their respective 200DMAs is progressing along with the S&amp;P 500. This indicates that a lot of healing is still happening well below the surface of the market.\" width=\"550\" height=\"375\" class=\"size-full wp-image-31537\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_T2107.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_T2107-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31537\" class=\"wp-caption-text\">The percentage of stocks trading above their respective 200DMAs is progressing along with the S&#038;P 500. This indicates that a lot of healing is still happening well below the surface of the market.<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>The volatility index, the VIX, continues along its own path of churn. It continues to trade just below the 15.35 pivot. In this position, it is not providing any clues to future direction. The VIX&#8217;s stasis mainly confirms the market&#8217;s general state of contentment. Oh how <a href=\"http:\/\/drduru.com\/onetwentytwo\/2015\/08\/25\/t2108-update-150824\/\" target=\"_blank\">the August Angst<\/a> is such a distant memory!<\/p>\n<p>Caterpillar (CAT) is one of the most bullish developments among the stocks I follow. As readers know, I like to buy put options against CAT as a hedge on bullishness. When CAT is powering higher, I consider it a confirmation of bullishness. I blinked and suddenly realized that CAT broke out above its 50DMA and is now following through.<\/p>\n<p><center><br \/>\n<figure id=\"attachment_31525\" aria-describedby=\"caption-attachment-31525\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_CAT.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_CAT.png\" alt=\"Caterpillar (CAT) is breaking out. It has left the disastrous post-earnings gap down far behind.\" width=\"550\" height=\"375\" class=\"size-full wp-image-31525\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_CAT.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_CAT-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31525\" class=\"wp-caption-text\">Caterpillar (CAT) is breaking out. It has left the disastrous post-earnings gap down far behind.<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>Some additional charts to consider while waiting for resolution of this tap dance with overbought status&#8230;<\/p>\n<p><center><br \/>\n<figure id=\"attachment_31526\" aria-describedby=\"caption-attachment-31526\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_IBB.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_IBB.png\" alt=\"iShares Nasdaq Biotechnology (IBB) confirmed its 50DMA breakout and apparently will not provide a dip to its 20DMA as my next buying opportunity\" width=\"550\" height=\"375\" class=\"size-full wp-image-31526\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_IBB.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_IBB-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31526\" class=\"wp-caption-text\">iShares Nasdaq Biotechnology (IBB) confirmed its 50DMA breakout and apparently will not provide a dip to its 20DMA as my next buying opportunity<\/figcaption><\/figure><br \/>\n<br \/>\n<figure id=\"attachment_31527\" aria-describedby=\"caption-attachment-31527\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_LNKD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_LNKD.png\" alt=\"Linked (LNKD) clears the hurtle again. October earnings closed the gap from July earnings and formed a 200DMA breakout.\" width=\"550\" height=\"375\" class=\"size-full wp-image-31527\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_LNKD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_LNKD-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31527\" class=\"wp-caption-text\">Linked (LNKD) clears the hurtle again. October earnings closed the gap from July earnings and formed a 200DMA breakout.<\/figcaption><\/figure><br \/>\n<br \/>\n<figure id=\"attachment_31530\" aria-describedby=\"caption-attachment-31530\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_RAX.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_RAX.png\" alt=\"Rackspace Hosting, Inc. (RAX)  is starting to turn the corner. Last year&#039;s M&amp;A talk is long forgotten: this could be the time to grab a steal under the radar.\" width=\"550\" height=\"375\" class=\"size-full wp-image-31530\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_RAX.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_RAX-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31530\" class=\"wp-caption-text\">Rackspace Hosting, Inc. (RAX)  is starting to turn the corner. Last year&#8217;s M&#038;A talk is long forgotten: this could be the time to grab a steal under the radar.<\/figcaption><\/figure><br \/>\n<br \/>\n<figure id=\"attachment_31532\" aria-describedby=\"caption-attachment-31532\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_BIDU.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_BIDU.png\" alt=\"It STILL hurts to have no Baidu (BIDU) in my pockets. A 200DMA breakout that closes the previous earnings gap down adds insult to injury...\" width=\"550\" height=\"375\" class=\"size-full wp-image-31532\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_BIDU.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_BIDU-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31532\" class=\"wp-caption-text\">It STILL hurts to have no Baidu (BIDU) in my pockets. A 200DMA breakout that closes the previous earnings gap down adds insult to injury&#8230;<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>My bonus chart is McDonald&#8217;s. A little over a year ago <a href=\"http:\/\/drduru.com\/onetwentytwo\/2014\/09\/12\/accumulate-mcdonalds\/\" target=\"_blank\">I suggested accumulating shares of McDonald&#8217;s<\/a> to take advantage of all the negativity surrounding the venerable chain at the time. <a href=\"http:\/\/seekingalpha.com\/article\/2453505-how-not-to-report-on-demographics-millennials-blamed-for-taking-down-mcdonalds\" target=\"_blank\">It was very fashionable to talk about how Millennials abandoned MCD. The menu was stale and unappealing for the more hip youth of today<\/a>. Behind the times. Etc, etc&#8230;One new CEO later and here is MCD making a very bullish breakout to new all-time highs&#8230;<\/p>\n<p><center><br \/>\n<figure id=\"attachment_31528\" aria-describedby=\"caption-attachment-31528\" style=\"width: 540px\" class=\"wp-caption alignnone\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_MCD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_MCD.png\" alt=\"Who said McDonald&#039;s was dead?!\" width=\"550\" height=\"375\" class=\"size-full wp-image-31528\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_MCD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2015\/11\/151102_MCD-300x205.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-31528\" class=\"wp-caption-text\">Who said McDonald&#8217;s was dead?!<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p><center><br \/>\n<strong>Daily T2108 vs the S&amp;P 500<\/strong><br \/>\n<img loading=\"lazy\" decoding=\"async\" title=\"T2108 vs. the S&amp;P 500 (DAILY)\" src=\"http:\/\/www.drduru.com\/money\/charts\/T2108-daily_s.png\" alt=\"\" width=\"500\" height=\"350\" \/><\/p>\n<p>Black line: T2108 (measured on the right); Green line: S&amp;P 500 (for comparative purposes)<br \/>\nRed line: T2108 Overbought (70%); Blue line: T2108 Oversold (20%)<br \/>\n<\/center><\/p>\n<p><center><br \/>\n<strong>Weekly T2108<\/strong><br \/>\n<a href=\"http:\/\/www.drduru.com\/money\/charts\/T2108-weekly_s.png\"><img loading=\"lazy\" decoding=\"async\" title=\"Weekly T2108\" src=\"http:\/\/www.drduru.com\/money\/charts\/T2108-weekly_s.png\" alt=\"Weekly T2108\" width=\"500\" height=\"350\" \/><br \/>\n*<strong>All charts created using <\/strong><\/a><strong><a title=\"Freestockcharts.com\" href=\"http:\/\/www.freestockcharts.com\/\" target=\"_blank\">freestockcharts.com<\/a><\/strong> unless otherwise stated<\/center><\/p>\n<p>The charts above are the my LATEST updates independent of the date of this given T2108 post. For my latest T2108 post <a href=\"http:\/\/drduru.com\/onetwentytwo\/tag\/t2108\/\" target=\"_blank\">click here<\/a>.<\/p>\n<p>\n<strong>Related links:<\/strong><br \/>\n<a href=\"http:\/\/www.drduru.com\/money\/T2108.htm\">The T2108 Resource Page<\/a><br \/>\n<a href=\"http:\/\/www.drduru.com\/money\/charts\/T2108-daily.jpg\">Expanded daily chart of T2108 versus the S&amp;P 500<\/a><br \/>\n<a href=\"http:\/\/www.drduru.com\/money\/charts\/T2108-weekly.jpg\">Expanded weekly chart of T2108 <\/a><\/p>\n<p>Be careful out there!<\/p>\n<p>Full disclosure: long CAT, long LNKD call spread, long MCD<\/p>\n","protected":false},"excerpt":{"rendered":"<p>(T2108 measures the percentage of stocks trading above their respective 40-day moving averages [DMAs]. It helps to identify extremes in market sentiment that are likely to reverse. To learn more about it, see my T2108 Resource Page. You can follow real-time T2108 commentary on twitter using the #T2108 hashtag. T2108-related trades and other trades are &#8230; <a title=\"T2108 Update (November 2, 2015) &#8211; The S&#038;P 500 Stairsteps Ever Higher and STILL Avoids Overbought Status\" class=\"read-more\" href=\"https:\/\/drduru.com\/onetwentytwo\/2015\/11\/03\/t2108-update-151102\/\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[1303,482,1054,219,43,599,512,511,62],"tags":[760,64,1522,579,1413,1265,65,225,226,1597,303],"class_list":["post-31523","post","type-post","status-publish","format-standard","hentry","category-bottom","category-breakout","category-dining","category-high-tech","category-industrial-sector","category-internet","category-resistance","category-support","category-technical-analysis","tag-bidu","tag-cat","tag-ibb","tag-lnkd","tag-mcd","tag-rax","tag-sp-500","tag-t2107","tag-t2108","tag-technical-analysis","tag-vix"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>T2108 Update (November 2, 2015) - The S&amp;P 500 Stairsteps Ever Higher and STILL Avoids Overbought Status - ONE-TWENTY TWO: Trading Financial Markets<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/drduru.com\/onetwentytwo\/2015\/11\/03\/t2108-update-151102\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"T2108 Update (November 2, 2015) - The S&amp;P 500 Stairsteps Ever Higher and STILL Avoids Overbought Status - ONE-TWENTY TWO: Trading Financial Markets\" \/>\n<meta property=\"og:description\" content=\"(T2108 measures the percentage of stocks trading above their respective 40-day moving averages [DMAs]. It helps to identify extremes in market sentiment that are likely to reverse. To learn more about it, see my T2108 Resource Page. You can follow real-time T2108 commentary on twitter using the #T2108 hashtag. T2108-related trades and other trades are ... 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