Written by A.J. Brown

Broad Market Analysis - September 29, 2017

Hi Team, this is A.J. Brown with Trading Trainer on the evening of Friday, September 29 with your Trading Trainer weekend edition of your Daily Insights. What we are going to do here is take a look at the broad market by taking a look at representative indexes of our watch list namely, the Dow Jones Industrial Average, the NASDAQ Composite Index, and the S&P 500 Index. We are also going to take a look at the New York Stock Exchange Composite Index, and the VIX Volatility Index. And, because it is the weekend, we are going to look at both daily and weekly charts. But, before looking at any charts, team, we are actually going to log into the Trading Trainer Learning Community web portal by going to login.tradingtrainer.com.

And, of course, once we’ve logged into the Learning Community web portal, I’m going to direct you right to today’s “Daily Insights” tab, and further to the “Recommendations” sub tab. Team, take a look at the recommendations we have for Monday, October 2nd’s trading session. Slight changes in these recommendations could have major impact on your trading. You’re also going to find here a link to our audio commentary. This is the audio where I take you by the hand through today’s “Daily Insights”, and its sub tabs. Go ahead and click on that link, an audio is going to start playing automagically in the background in another browser tab, or another browser window depending on how you have your browser configured. Go ahead and listen to that audio the first time you do click through today’s “Daily Insights” and its sub tabs, it’ll make sure you hit all the high points, you can always drill down deeper on your own, after the audio is over. Team, when you listen to the audio commentary, please pay special close attention to the opening and closing comments. In the meantime, for this particular Broad Market Analysis of this Chart of Interest video series, let’s start off at the “Index Stats” sub tab.

indextrends

Team, our trading bias remains bullish. Our industrials, shown by the Dow Jones Industrial Average, gained 0.11% today on heavy, above average New York Stock Exchange volume, gained 0.25% for the week on heavy, above average New York Stock Exchange weekly volume. Our tech stocks shown by the NASDAQ Composite Index gained 0.66% today on heavy, above average NASDAQ exchange volume, gained 1.07% for the week on heavy, above average NASDAQ exchange weekly volume. Our large caps shown by the S&P 500 Index gained 0.37% today, 0.68% for the week.

Let’s take a look at our secondary indexes. Our 100 best stocks out there shown by the S&P 100 gained 0.31% today, 0.5% for the week. Our mid caps shown by the S&P 400 Index gained 0.13% today, 1.54% for the week. Our small caps shown by the S&P 600 and the Russell 2000, two different perspectives on small caps, gained 0.23% and 0.14%, respectively, for today; and 3.33% and 2.77%, respectively, for the week. Our New York Stock Exchange Composite Index gained 0.25% today and 0.48% for the week. Our VIX Volatility Index fell 0.42% today, fell 0.83% for the week closing on $9.51 per VIX share. Our Gold ETF fell 0.52% today, fell 1.35% for the week. Our oil ETF was flat today and gained 1.86% for the week.

Team, let’s take a look at our economic calendar. We’ll go to our “Daily Insights” tab and our “Economic Calendar” sub tab. First thing I’m going to ask you to is read today’s Market Reflections summary and then fast forward to Monday, October 2nd and read our Market Focus pointers. Also, on Monday, October 2nd, please read the International Perspective and the Simply Economics reports. These two reports lay a good foundation about what happened in the economic news this previous week and what to expect for the week to come.

calendaroct2

Back to today, Friday, September 29, the Personal Income and Outlays were reported.

calendarsept29

For July, personal income was up 0.4%. We revised that number to be up 0.3%. And for August, we’re reporting 0.2%. Consumer spending in July was up 0.3% and August we’re reporting up 0.1%. The Personal Consumption Expenditures Price Index for July was up 0.1%, for August, up 0.2%. The core Personal Consumption Expenditures Price Index for July was up 0.1%, for August up 0.1%. The Personal Consumption Expenditures Price Index year-over-year in July was up 1.4%, in August, up 1.4%. And the core Personal Consumption Expenditures Price Index year-over-year in July was up 1.4%, and for August, up 1.3%, well below the Fed target rate.

For the Chicago PMI, the business barometer index level for August came in at 58.9, for September, 65.2.

Consumer Sentiment final numbers, prior was 95.3, final 95.1. Looking again to next week, on Monday, we have our Institute for Supply Management’s Manufacturing Index numbers and our PMI manufacturing index numbers as well as our Construction Spending numbers.

Let’s take a look at our watch list by going to the “Trading Tools” tab and the “Watch List” sub tab. We have quite a few tickers identified by our covered call writing and our option trading candidate filters. We will evaluate these symbols for liquidity and patterns before adding them permanently to our list.

Let’s click on the “Trading Tools” tab and the “Daily Picks” report generation tool tab. Let’s do a deeper dive on our indexes by looking at volume and trends.

volumntrends

Our volume was heavier than yesterday, heavier than the 50-day simple moving average, heavier than the 200-day simple moving average, and the oscillator was pointing up. Our short-duration trends for the big three were neutral, for the mid caps and small caps, bullish. Our long-duration trends are neutral.

Backing it up and taking a look at our template algorithm filters, these mathematically go through whatever raw data they are presented with, looking for patterns in the numbers. We’re going to present it with the raw data of our index tickers. That’s going to give us an idea of what the broad market personality is doing, as well as what to look for in our watch list.

template1

Trend continuations, for the most part, are coming up empty.

template2

Our short-term trend test and trend reversal test remain bullish.

template3

Our pattern alterations are getting into our double digit candlestick counts and the Bollinger Bands, for the most part, remain wide. The NASDAQ is the exception.

Let’s go to our “Trading Tools” tab and our “Charting” sub tab. Let’s look at our Quick Review template. This is a six-month, daily chart, linear scale, open high low close bar, with a separate pane for volume and volume average. To that, I’m going to add the 200, 50 and 30-day simple moving averages. These lagging indicators help me determine trend. I’m going to apply those in a user-defined template found here in my personal profile. Again, this is the Quick Review template with those three simple moving averages applied. We’re going to use that template against our indexes specifically starting out with the Dow Jones Industrial Average. Once this loads, team, I’m going to expand it to full screen.

Because it is the weekend, we’ll start with a weekly, 2-year chart.

djiaweekly

We have higher highs and higher lows. This week, we wound up edging higher and volume was actually quite heavy for the week. We’ll come back to our six-month, daily chart.

djiadaily

Our 200, our 50 and our 30 remain trending up. Our seven-day simple moving average has flattened out, but it’s pretty wide and we had a nice up-day on heavy volume.

djia5min

We’re going sideways here for the day and then popped up as if there was bargain buying right at the end of professional hour. We closed at $22,405.09. For the most part, our notes stay the same. We end with a bullish trading bias.

We’ll move to the NASDAQ Composite Index looking at a weekly, two-year chart.

nasdaqweekly

Higher highs and higher lows continuing to reach higher, good volume this week. Let’s return back to a six-month, daily chart.

nasdaqdaily

The 7 is up. The 30 is up. The 50 is up. Today was a beautiful S-bar on pretty good volume. Our 200 is up. Looking at five-minute charts, for the whole morning session, we had gains and then we stalled in the afternoon.

nasdaq5min

We closed at $6,495.96. Our low was $6,454.86. We’ll go ahead and remove this note about being ‘closed above resistance’ and we will adjust our levels of support and resistance. We’ll go to $6,460 for support and then the next round number of $6,500 for resistance. At this point, we’ll allow one more up-day and wind up changing our trading bias to full on bullish. For now, we’ll keep it at neutral bullish.

Taking a look at the S&P 500 Index weekly, two-year chart, higher highs, higher lows, nice S-bar, good volume.

sp500weekly

Bringing us back to the six-month, daily chart, great S-bar today.

sp500daily

The 30 and the 50 and the 200 are all trending up, oriented correctly, and the seven-day is trending up as well. Our five-minute chart shows gains in the morning session and then surprising gains at the end of professional hour.

sp5005min

We closed at $2,519.36. Our notes stay the same with a bullish trading bias.

Moving on to the secondary New York Stock Exchange Composite Index weekly, two-year chart, higher highs, higher lows, trending up.

nyseweekly

Bringing us back to the six-month daily chart, 30 is up, 50 is up, 7 is up, 200 is up. We’re going to keep a bullish trading bias.

nysedaily

Switching to our VIX weekly, two-year chart with 40-week simple moving average, our VIX is well below our 40-week simple moving average and is pulling it down lower.

vixweekly

Bringing it back to a six-month, daily chart with 200-day simple moving average, again, we can see that the VIX is incredibly low.

vixdaily

The VIX is down 0.42% closing at $9.51 per share.

Our overall trading bias remains bullish.

Our broad market personality is still trending up, oversold, and in a state-of-range contraction, even with today’s up day. One up day does not make an up market especially with the intraday price action we’ve uncovered.

The market is responding to the following including but not limited to transient external stochastic shocks, the US fiscal policy, the US Federal Reserve monetary policy, the monetary policies of China, Europe and Japan, the price of oil, US economic news, including employment, housing, manufacturing and retail, and market news including mergers-acquisitions, initial public offerings, public companies going private, and earnings.

That’s all I’ve got, Team. Please, take care.

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