[pcabc]

Gold versus its miners

Large down day Thurday followed by breaking recent support Friday on large volume (at least for the GLD ETF I'm tracking [1].  I'm not surprised by the gold price drop as it looked over-extended.  The breadth calculated from the gold mining stocks has plunged.  Not so obvious on a 2 year duration chart, but this drop started two weeks ago, but really gained downward momentum last week.  Notable points are, numbers of miners abouve their 20, 50 and 200 day EMAs have plunged [11, 12 & 13].  The silver and gold cross indices [14 & 15] have also dropped, so the numbers of miners with their 20 day EMA > their 50 day EMA and their 50 day EMA > 200 day EMA is have dropped significantly.  The 1% A/D line has bounced down from its zero line [6]. So gold has started a pullback and miners are likely to do the same.

   

[pcabc]

S&P500 versus Russell 3000

There was a big down day Friday, not very visible on a chart that spans 2 years.  However, it remains above the downtrend that has run for the last year and is above 4100 [1].  New Highs minus New Lows remained positive, and the Cumulative New Highs Minus new lows has crossed above its 100 day SMA [4].  The Wienstein Momentum and 1% A/D lines remain above their zero lines and are still headed upwards.  The % stocks above their 20, 50 and 200 day EMAs and the gold and silver cross indices are all strong with the gold cross index [15] on the 50% mark headed upwards.  The A/D line [2, red] and A/D volume [2, yellow] still confirm the recent high.This feels bullish despite Friday.  Lets see how it goes.

   

[pcabc]

Bitcoin and crypto seem to be defying gravity

Personally I would have expected a pullback.  Does not seem to be happening.
   

[pcabc]

Pring's Bottom Fisher

I've seen a few references to Pring's Bottom Fisher, a market breadth indicator that is considered, in the few articles I can find online, to be a reliable indicator for detecting market bottoms.  This seems to be one of the less well known indicators.  The best description I can find is in Stockcharts.  Rather than make a second rate precis I suggest reading the article there.

I've also found a Youtube video which discusses its performance.

I've tried adding this indicator to my homegrown database / screener.  Any sensible person will use the one in Stockcharts I suggest.  Unaware of any other platforms that have it available.  It is quite onerous to calculate as it needs Pring's KST indicator to be plotted for each stock in your pool of stocks and use that to determine the %s of stocks in winter or spring, as per the Stockcharts article.  I've calculated it for my (rather out of date) pool of stocks representing the Russell 3000 and plotted that versus the S&P500.  No gauruntees I have calculated the indicator correctly as I had to make a few assumptions calculating it and it is difficult to check my calculations.
   

The key levels seem to be when the indicator descends below the 10 and 30% levels, especially the latter.  A 9 period SMA can be used as a signal line.  Looking at the plot it worked well when rising from below 30% level through the signal line, circled in green.  The two points circled in amber (muddy brown!) and red worked less well.  However, these crosses of the signal line were above the 30% level.  So perhaps the cross needs to be below the 30% level for a greater chance of sucess.  Perhaps though, my dataset is rather small for good test?

Interesting indicator.

[pcabc]

Pring's Bottom Fisher

I thought it might be interesting to plot a 5 year duration chart.  Also worth noting the trendline on the S&P 500, it is / is about to be tested.
   

Its not perfect, note the signal just before the March 2021 covid crash.

[pcabc]

Its not perfect, note the signal just before the March 2021 covid crash.

Zooming in on a higher resolution plot shows that that is a small low, it does rise up after so it was correct, but then there is the sudden crash.

Edit: I jumped the gun a little, see the red line in the attached plot, which also includes the Silver and Gold Cross Indicies:
   

I recall at the time that although the markets seemed to be positive there was talk of lockdowns etc, so although ignore the news, listen to the tape is the mantra, there was good reason for pause at the time.

[pcabc]

Market breadth

Interesting going-ons in market breadth.  The S&P500 itself seems to be pulling up from a higher low having made a higher high [1].  This looks bullish and is backed up by the Advance Decline line and its volume counterpart matching this [2].  On the bearish side the % stocks above their 20, 50 and 200 day EMAs [10,11 & 12] have declined as have the silver and gold cross indicies [13 & 14] - though its hard to tell on the latter on the chart posted as its now got too much info to be visible at the resolution posted.  My aggregate scores [A&B] are quite negative apart from the very short term one.

   

The indexes behavious [1, above] however led me to think that a lot of the negative sentiment was just normal for a pull back.  However, there is a bit more to look at.

Brokers versus S&P500
Pring suggests plotting the relative strength of brokers ETF against the S&P500 as a breadth measure.  If the brokers ETF is doing well then thats indicative of a bullish sentiment. Look at the blue plot, this is the R/S of broker dealers against the S&P500, and there has been a plummet of their R/S.  Apologies for the spurious captions, I don't put these charts on line often to the extent that I forgot about the spurious other A/D etc captions.

   


S&P500 & Russell 1000 and their equal weight versions
The Russell 1000 plot if of the equal weight version against the index.  The R/S plot is plummeting, so, given that the equal weight index is the numerator and the standard Russell 1000 the denominate this means the equal weight version of the index is weakening significantly.  I'd support that the reason is the smaller cap stocks falling behind the large caps.
   

Annoyingly the S&P500 and equal weight variant is the other way up, with the S&P500 divided by its equal weight version.  So, when the equal weight version weakens, as it does here, the R/S curve peaks upward.
   


If I post these often I ought to consider cleaning them up and going for a bit more consistency.

[pcabc]

S&P500 versus Russell 3000

My very shrt, short, medium and long term aggregate scores all show strong or strengthening breadt [A & B].  However, the important thing to see is whether we make a higher high [1].  We should find out in the next week or so, but Easter may cause some disruption.  % stocks about their 20, 50 and 200 day EMAs all increasing [10, 11 & 12].

   

Sector breakdown:

My personal scoring system broken down into the US sectors:
   

As you can see, the following are scoring positively in all time scales:
  Technology
  Consumer Staples
  Industrials
  Healthcare
  Materials
  Communication Services