Weekend Report for Monday, February 26

Bottom Line:

The trend is up. The US indices are in a bull market. Bull markets are characterized by relentless ramps and minor, short-lived retracements. The current rally is not at all unique when compared to previous bull markets, and legs within those markets.

Traders, and analysts, have very short memories. Please take some time and go back and review bull markets and legs within those bull runs. I would suggest late 1994 as a great place to start.

EVERYONE is trying to pick a top. This is totally expected and exactly what occurred in every single bull market, and bull market leg, that any of us has experienced.

The SPX is making only minor 2 to 2 1 / 2% retracements. At some point it will no doubt have a deeper retracement, but in the meantime it may go up another 5-7%+ first. 

Pay attention to the simple, objective things that involve price action. We trade price.

Until the SPX (and other indices) begin making lower lows and highs the trend is up.

This is actually TRADABLE information in ALL time frames. It isn’t sexy or magic, but it works.

Keep it simple. 

PDF: Weekend Report_2024_02_26

VIDEO

SPX

Upper KRA: 5111
Lower KRAs: 5038, 4947

NDX

Upper KRA: 18091
Lower KRAs: 17808, 17319

DOW

Upper KRA: 39282
Lower KRAs: 38802, 38338

RUT

Upper KRA: 2071
Lower KRAs: 1982, 1897

I’m simply setting alerts at 2071 and 1897. I’m not going to waste time and energy on the RUT between those levels.

SPX Profile 

Below are comments from three four weeks ago. Nothing has changed.

From the weekly perspective there has been one minor pocket of Balance since the October 27 low. It appears another distribution (range) began at the January lows in the indices. The relative lack of Balance, and the depth of retracement in that Balance is unusual and likely to eventually result in a top of larger degree than we have seen since that October low. Where that top may occur is a complete unknown (see above).

Internals

NYSE internal data has not been helpful. It is never as useful in bull trends than in bear trends, and that is especially true in the present with only 5-7 stocks completely controlling the direction of the NDX, SPX and DOW.

The divergences between price action in the SPX and breadth continue to mount. But when it will matter resulting in some top of relative significance is a total guess.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

US 10-yr Notes

No change: Trend is down. Approaching a downside KRA.

US Dollar

No change: The Dollar has been in an extraordinary whippy day-to-day chopfest, but so far with a clear upside bias. 

Gold

Stuck between critical levels. Still.

Crude

A close above 79.84 is bullish.