{"id":31665,"date":"2015-11-11T00:15:12","date_gmt":"2015-11-11T08:15:12","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=31665"},"modified":"2015-11-11T00:16:24","modified_gmt":"2015-11-11T08:16:24","slug":"t2108-upate-151110","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2015\/11\/11\/t2108-upate-151110\/","title":{"rendered":"T2108 Upate (November 10, 2015) – A Deceptively Calm Market Day"},"content":{"rendered":"

<\/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 T2108 Resource Page<\/a>. You can follow real-time T2108 commentary<\/a> on twitter using the #T2108 hashtag. T2108-related trades and other trades are occasionally posted on twitter using the #120trade hashtag<\/a>. T2107 measures the percentage of stocks trading above their respective 200DMAs)<\/p>\n

T2108 Status<\/strong>: 55.7%
\nT2107 Status<\/strong>: 31.9%
\nVIX Status<\/strong>: 15.3
\nGeneral (Short-term) Trading Call<\/strong>: slightly bearish
\nActive T2108 periods<\/strong>: Day #27 over 20%, Day #26 over 30%, Day #26 over 40%, Day #24 over 50% (overperiod), Day #1 under 60% (ending 8 days over 60%) (underperiod), Day #341 under 70%<\/p>\n

Reference Charts<\/strong> (click for view of last 6 months from Stockcharts.com):
\nS&P 500<\/a> or SPY<\/a>
\nSDS<\/a> (ProShares UltraShort S&P500)
\nU.S. Dollar Index<\/a> (volatility index)
\nEEM<\/a> (iShares MSCI Emerging Markets)
\nVIX<\/a> (volatility index)
\nVXX<\/a> (iPath S&P 500 VIX Short-Term Futures ETN)
\nEWG<\/a> (iShares MSCI Germany Index Fund)
\nCAT<\/a> (Caterpillar).
\nIBB<\/a> (iShares Nasdaq Biotechnology).<\/p>\n

Commentary<\/strong>
\nIn the last T2108 Update<\/a>, I continued to make the case that the market’s momentum is waning. I left out an important piece of the story: T2107 – the percentage of stocks trading above their respective 200-day moving averages (DMAs).<\/p>\n


\n
\"The<\/a>
The recovery for T2107 stopped cold just short of a complete reversal of the losses from the August Angst<\/figcaption><\/figure>
\n<\/center><\/p>\n

As the chart above shows, the percentage of stocks trading above their respective 200DMAs has yet to recover all the losses recorded since the August Angst began. This means the downtrend that accelerated starting in May is still in place and still telling us that the underlying breadth of the market’s advance is very poor. As a reminder, T2107 has been in decline ever since its first rapid post-crisis recovery.<\/p>\n


\n
\"To-date,<\/a>
To-date, the on-going deterioration in breadth – relative to the critical long-term trend indicator 200DMA – of the market has mattered little<\/figcaption><\/figure>
\n<\/center><\/p>\n

T2108 closed at 55.7% after recovering from early losses. For a brief moment it looked like the bearish breakdown was underway. The S&P 500 similarly held up and marked a second day honoring its 200DMA support. Note how that support has now converged with an uptrending 20DMA.<\/p>\n


\n
\"The<\/a>
The S&P 500 (SPY) prints a small rebound above 200DMA support<\/figcaption><\/figure>
\n<\/center><\/p>\n

The volatility index, the VIX, failed to follow through on its recent breakout. It closed right on top of the 15.35 pivot line. I am still looking for a definitive break upward or downward.<\/p>\n


\n
\"The<\/a>
The volatility index is like a moth to a flame when it comes to the longstanding pivot at 15.35.<\/figcaption><\/figure>
\n<\/center><\/p>\n

Speaking of churning in place, I am similarly waiting on Intuitive Surgical (ISRG) to make its next move. It has settled down quickly since printing a post-earnings fade.<\/p>\n


\n
\"Intuitive<\/a>
Intuitive Surgical is now stuck in post-earnings holding patterns as buyers and sellers lock horns.<\/figcaption><\/figure>
\n<\/center><\/p>\n

Just beyond the apparent surface calm of the market, traders can still find evidence of increasing deterioration. Two important charts demonstrate more of the waning momentum I am monitoring.<\/p>\n

Tableau Software, Inc. (DATA) had a very impressive post-earnings gap up last Friday that caught me completely off-guard. After the stock failed to show any signs of life after August earnings, I figured sentiment was starting to turn against DATA. However, it looks like the celebration is already coming to a slow end as DATA has failed to resume its post-earnings rally. Instead, its 200DMA breakout has quickly swung to a fresh 200DMA breakdown that could be the beginning of a gap fill.<\/p>\n


\n
\"The<\/a>
The post-earnings celebration for Tableau Software, Inc. (DATA) is already starting to wane.<\/figcaption><\/figure>
\n<\/center><\/p>\n

<\/p>\n
\n

Surprised one analyst note can knock $AAPL<\/a> off its rocker but consistent with waning market: http:\/\/stks.co\/h3QxK<\/a> 200DMA holds as resist<\/p>\n

— Duru A (@DrDuru) Nov. 10 at 06:44 AM<\/a><\/p><\/blockquote>\n