Bursa KLCI

31 May 2018 – Tariffs are on, indices sink

Indices
Dow Transportation closed at 10750.33 with a bearish candle below its 8 EMA and above its 21 EMA and 50 SMA. Daily trading range was 206.83. BuySellTimer is in its negative cycle. TSI is in a positive cycle and negative slope. Market direction – Intermediate – Buy. Current – Neutral/Sell. Negative divergence signal.

Dow Industrial closed at 24415.84 with a bearish marubozu candle below its 8 EMA and 21 EMA and just above its 50 SMA. Daily trading range was 268.64. BuySellTimer is in a negative cycle. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Buy. Current – Sell/Sell. Negative divergence signal.

Russell 2000 closed at 1633.6095 with a bearish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 17.48. BuySellTimer is in a positive cycle. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Buy. Current – Buy/Buy. Negative divergence signal.

Nasdaq 100 closed at 6967.73 with a doji candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 60.42. BuySellTimer is in its positive cycle. TSI is in a positive cycle and positive slope. Market direction: Intermediate – Buy. Current – Buy/Buy. Negative signal divergence.

S&P 500 closed at 2705.27 with bearish candle below its 8 EMA and on its 21 EMA and above its 50 SMA. Daily trading range was 21.82. BuySellTimer is in its negative cycle. TSI is in a positive cycle and negative slope. Market direction – Intermediate – Buy. Current – Neutral/Sell.

Metals and Commodities
WTI Crude oil futures (CL) closed at $67.1 per barrel with a bearish candle below its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 1.74. BuySellTimer is in a negative cycle. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Sell. Current – Sell/Sell.

Gold futures (GC) closed at 1302.7 with a low closing spinning top doji candle above its 8 EMA and below its 21 EMA and 50 SMA. Daily trading range was 10.5. BuySellTimer is in a positive cycle. TSI is in a negative cycle and positive slope. Market direction: Intermediate – Sell. Current – Neutral/Buy.

Agriculture (DBA) ETF closed at 19.21 with a bearish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.15. BuySellTimer is in a positive cycle. TSI is in a positive cycle and positive slope. Market direction: Intermediate – Buy. Current – Buy/Buy.

Commodities (DBC) ETF closed at 18.03 with a spinning top doji candle below its 8 EMA and above its 21 EMA and 50 SMA. Daily trading range was 0.24. BuySellTimer is in its positive cycle. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Buy. Current – Neutral/Sell.

Bonds
Bond futures (/ZB) closed at 144’11 with a bearish candle above its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 2.19. BuySellTimer is in its positive cycle. TSI is in its positive cycle and positive slope. Market direction: Intermediate – Buy. Current – Buy/Buy.

High Yield bond ETF (HYG) closed at 85.38 with a bearish candle below its 8 EMA, 21 EMA and 50 SMA. Daily trading range was 0.14. BuySellTimer is in a negative cycle. TSI is in a negative cycle and negative slope. Market direction: Intermediate – Sell. Current – Sell/Sell.

Currencies
The dollar index ($DXY) closed at 93.977 with a spinning top doji candle on its 8 EMA above its 21 EMA and 50 SMA. Daily trading range was 0.53. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Buy. Current – Buy/Buy. Negative divergence.

EUR/USD closed at 1.1690 with a spinning top doji candle above its 8 EMA and below its 21 EMA and 50 SMA. Daily trading range was 0.0083. TSI is in a negative cycle and positive slope. Market direction: Intermediate – Sell. Current – Sell/Buy.

USD/JPY closed at 108.80 with a high closing spinning top doji candle below its 8 EMA and 21 EMA and above its 50 SMA. Daily trading range was 0.612. TSI is in a positive cycle and negative slope. Market direction: Intermediate – Sell. Current – Sell/Sell.

6S(Swiss Franc) – closed at 1.0157 with a bullish marubozu candle above its 8 EMA and 21 EMA and below its 50 SMA. Daily trading range was 0.0068. BuySellTimer is in a positive cycle. TSI is in a negative cycle and positive slope. Market direction: Intermediate – Buy. Current – Buy/Buy.

Relative Strength – Sectors
On a monthly lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLK, XLI, XLU, XLE and XLY.

On a 3-monthly lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLE, XLK, XLY and XLI respectively.

Market Internals
Market sentiment is bullish. Market breadth is sloping upwards showing nett gainers to losers. Accumulation/ Distribution is sloping upwards showing distribution. Skew is at 143.89. Vix is at 15.43 and Vix futures is at 15.30.

The Week Ahead
Skew continues to remain high and shows that there are many short positions on the S&P 500. The short positions have to be relieved to the downside before it can rise again. Market breadth is still showing nett gainers to loser but volume is showing high level of selling. Vix is rising and Vix futures is at about the same level. This tends to indicate that there will be a quick pullback in the near term. The prognosis is for a quick pullback.

Futures Summary(daily chart):
ES – Intermediate Buy. Short term Neutral/Sell. Negative Divergence.
NQ – Intermediate Buy. Short term Buy/Buy. Weekly Squeeze. Negative Divergence.
YM – Intermediate Buy. Short term Sell/Sell. Negative Divergence. Weekly Squeeze.
GC – Intermediate Sell. Short term Neutral/Buy. Weekly Squeeze.
CL – Intermediate Sell. Short term Sell/Sell.

 

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