Big Picture Review
By
Rennie on Thursday, March 24th, 2011 at 11:43 am
The Market Vane survey of commodity trading advisors recently marked its 26th consecutive week with a majority of bullish respondents. That’s a pretty rare feat, only occurring on five other separate instances since 1985. All preceded further market strength over the next year. This same pattern was triggered almost exactly one year ago, drawing a comparison to the ’96-’97 time frame…
Market Vane Bullish Consensus 26 Weeks >=50%
03/11/11… S&P +0.3% OPEN – ENDS 03/09/12… 4.2% max dd (open)
03/12/10… S&P +13.4% one year later… 12.1% max dd
02/06/04… S&P +5.3% one year later… 7.2% max dd
10/17/97… S&P +11.9% one year later… 9.4% max dd
03/14/97… S&P +34.7% one year later… 7.6% max dd
02/16/96… S&P +24.8% one year later… 6.5% max dd
Following is a summary of recently triggered intermediate and long-term signals…
VXO closed Up 10%+ two consecutive sessions on March 15 & 16th, which points to a higher S&P three months later. Forecast: S&P will be above 1256 mid-June. See http://markettells.com/2011/03/follow-up-to-vix-vxo-set-to-trigger-bottoming-signal/
As of Wednesday’s close, we’re still down 2% since the end of February. When the S&P is YTD positive end of February, the S&P finished out the year above February’s close in 31 out of 33 occurrences (94%) since 1950, averaging a gain of 14.5% (measuring from February’s close to year-end). In only one year was the S&P down more than 2% from February’s close. Forecast: S&P will be above 1327 end of December. See http://markettells.com/2011/03/spx-closes-below-its-50-day-sma-february-effect-reminder/
The S&P posted seven consecutive higher lows on the monthly chart at the end of February. That’s only occurred 14 times in the history of the stock market, all but one of which led to a higher S&P seven months later. Forecast: S&P will be above 1327 end of September. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
March is shaping up to be the S&P’s first month with a lower high after six higher monthly highs. After six or more higher highs on the monthly chart, the first month with a lower high has usually been a buying opportunity. In 25 out of 26 occurrences since 1930, the S&P (or Dow) posted a higher monthly close within the next three months and usually the next month. Forecast: S&P will post a monthly close above March 31st close in April, May or June. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
The S&P will post its third quarterly gain at the end of this month on a close above SPX 1257. There have been 24 separate instances in which the S&P500 initially posted three straight quarterly gains. In every case but one, the S&P proceeded to post a subsequently higher quarterly close within the next nine months (and usually the next quarter). Forecast: S&P will post a quarterly close above March 31st close by end of 2011. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
I’d also draw your attention to the study conducted by Wayne Whaley on the S&P’s recent drop below the 50-day average (referenced here) which points to an S&P above 1295 in early June, along with the bullish implications of the recent 82.4 reading from the SPX 3-day Advance/Decline Thrust (interactive chart | screenshot). Wayne expanded significantly on the big picture outlook in last night’s column.
Big Picture Review
By Rennie on Thursday, March 24th, 2011 at 11:43 amThe Market Vane survey of commodity trading advisors recently marked its 26th consecutive week with a majority of bullish respondents. That’s a pretty rare feat, only occurring on five other separate instances since 1985. All preceded further market strength over the next year. This same pattern was triggered almost exactly one year ago, drawing a comparison to the ’96-’97 time frame…
Market Vane Bullish Consensus 26 Weeks >=50%
03/11/11… S&P +0.3% OPEN – ENDS 03/09/12… 4.2% max dd (open)
03/12/10… S&P +13.4% one year later… 12.1% max dd
02/06/04… S&P +5.3% one year later… 7.2% max dd
10/17/97… S&P +11.9% one year later… 9.4% max dd
03/14/97… S&P +34.7% one year later… 7.6% max dd
02/16/96… S&P +24.8% one year later… 6.5% max dd
Following is a summary of recently triggered intermediate and long-term signals…
VXO closed Up 10%+ two consecutive sessions on March 15 & 16th, which points to a higher S&P three months later. Forecast: S&P will be above 1256 mid-June. See http://markettells.com/2011/03/follow-up-to-vix-vxo-set-to-trigger-bottoming-signal/
As of Wednesday’s close, we’re still down 2% since the end of February. When the S&P is YTD positive end of February, the S&P finished out the year above February’s close in 31 out of 33 occurrences (94%) since 1950, averaging a gain of 14.5% (measuring from February’s close to year-end). In only one year was the S&P down more than 2% from February’s close. Forecast: S&P will be above 1327 end of December. See http://markettells.com/2011/03/spx-closes-below-its-50-day-sma-february-effect-reminder/
The S&P posted seven consecutive higher lows on the monthly chart at the end of February. That’s only occurred 14 times in the history of the stock market, all but one of which led to a higher S&P seven months later. Forecast: S&P will be above 1327 end of September. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
March is shaping up to be the S&P’s first month with a lower high after six higher monthly highs. After six or more higher highs on the monthly chart, the first month with a lower high has usually been a buying opportunity. In 25 out of 26 occurrences since 1930, the S&P (or Dow) posted a higher monthly close within the next three months and usually the next month. Forecast: S&P will post a monthly close above March 31st close in April, May or June. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
The S&P will post its third quarterly gain at the end of this month on a close above SPX 1257. There have been 24 separate instances in which the S&P500 initially posted three straight quarterly gains. In every case but one, the S&P proceeded to post a subsequently higher quarterly close within the next nine months (and usually the next quarter). Forecast: S&P will post a quarterly close above March 31st close by end of 2011. See http://markettells.com/2011/03/persistent-moves-on-the-monthly-and-quarterly-sp-charts/
I’d also draw your attention to the study conducted by Wayne Whaley on the S&P’s recent drop below the 50-day average (referenced here) which points to an S&P above 1295 in early June, along with the bullish implications of the recent 82.4 reading from the SPX 3-day Advance/Decline Thrust (interactive chart | screenshot). Wayne expanded significantly on the big picture outlook in last night’s column.