Bull Starting to Show Some Wear and Tear

Good Monday morning and welcome back to the land of blinking screens. My guess is that after the big game - and what a game it was - the last thing anyone is thinking about is a bunch of market models and indicators. But this is what discipline is all about. So, let's buckle down and run through a review of my favorite models and indicators.

The State of the Trend

We start each week with a look at the "state of the trend" from our objective indicator panel. These indicators are designed to give us a feel for the overall health of the current short- and intermediate-term trend models.

Executive Summary:

  • With the major indices flirting at all-time highs, it is not surprising to see a lot of green on the trend board.
  • However, the question of the day is if the bulls can break on through to the other side
  • The negative on the board is the Cycle Composite, which projects slightly lower prices by the end of the week
  • It is worth noting that the "trading mode" models are not unanimous at this point and as such, the strength of the current trend is a question mark

The State of Internal Momentum

Now we turn to the momentum indicators...

Executive Summary:

  • Overall, the momentum board is clearly positive
  • However, the ST Volume, Volume Thrust, and Breadth Thrust indicators are all neutral, which suggests there isn't a lot of "oomph" behind the current move (well, so far, at least)
  • The Price Thrust indicator is also barely in the green zone
  • In sum, the board's historical return is pretty strong and suggests siding with the bulls for the time being

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