Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Percentage of Stocks Above 20-50-200-Day Averages

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The three Daily charts below show the Percentage of
Stocks Above their 20-50-200 Day Moving Averages. At the moment, they
are all above 50%.

In the event that the 6 Major Indices and 9 Major Sectors drop and
hold below their middle Bollinger Band on their Daily timeframe, I'd check to
see if the percentage on the above referenced three charts also drops and holds
below the 50% level. If all three fall and hold below, it's a likely
confirmation of further weakness to come in the equity markets in the short,
medium, and longer terms…possibly signalling a correction.

 

Money Flow for August Week Four

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Further to my last weekly market update, this week's update will be a
very simple top-down look at the 6 Major Indices and 9 Major
Sectors. To keep my analysis simple, I'll be looking at Friday's
closing price relative to its position within the Bollinger Bands (BB) on three
timeframes. The upper BB represents resistance, the middle BB represents either
support or resistance, and the lower BB represents support. Price in between the
middle BB and the upper BB is said to be in the "Bull Zone"
(still under bullish influences/buying pressure with support at the middle BB)
and price in between the lower BB and the middle BB is said to be in
"Bear Zone" (currently under bearish influences/selling
pressure with resistance at the middle BB).

(more…)

China Slowdown Continues

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Data released after hours on Wednesday shows that the slowdown
in China continues, as shown on the graph below.

As I mentioned in my post of August 15th, China's Shanghai Index is struggling
to stabilize at three-year lows. Without a sizeable pickup in demand for its
products, any temporary stimulus measures that its Central Bank may employ may
not have much effect. This is a major player in the global economic slowdown
that is currently unfolding, and is one to watch over the coming weeks.

Consumers Grow More Uncomfortable in Europe

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Data released today (Thursday) shows that consumers in
the Eurozone are growing ever-more uncomfortable, as shown on the graph
below.

Since Consumer Confidence is a "leading indicator of consumer
spending, which accounts for a majority of overall economic activity," and they
are approaching the 2009 lows, this does not match the buoyant signals that the
European markets have been sending/portraying. As they are major importers of
Chinese products, this will, no doubt, continue to impact China's slowing
economy, as mentioned in my last post.

What’s Really Changed?

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What's really changed since Standard & Poor's downgraded
the U.S. credit rating on August 5, 2011?

One year has passed, and the
SPX has gone from a low of 1074.77 on October 4, 2011 to a high
of 1426.68 yesterday (Tuesday), as shown on the Daily chart below. A double top
has formed at major resistance.

The credit rating has not been upgraded. The Fed also downgraded the economic
outlook at their meeting on August 9, 2011, as mentioned in my post of August 9th. The Fed remains committed to holding
long term interest rates low for the foreseeable future. Europe's economic
condition has weakened. The global economies have slowed. And, finally, the U.S. National Debt
continues to rise (unabated) to all-time highs each second. The Fiscal Cliff
looms.
Who is convinced that economic and fiscal conditions have improved since then?
The only ones, so far, have been the buyers above the yellow arrows. No doubt
they will begin to take profits at current levels and re-think their positions
after the next FOMC meeting in September. A drop and hold below June's lows of
this year would confirm that their sentiment has changed.