About

Rajveer Rawlin received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher having followed capital markets in the US and India since 1993. His research interests includes areas of Capital Markets, Banking, Investment Analysis and Portfolio Management and has over 20 years of experience in the above areas covering the US and Indian Markets. He has several publications in the above areas. The views expressed here are his own and should not be construed as advice to buy or sell securities.

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Saturday, 13 February 2016

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning February 15

Indicator
Weekly Level / Change / Significance
Implication for
S & P 500
Implication for Nifty*
S & P 500
1865, -0.810%
Bearish
Bearish
Nifty
6981, -6.79%
Neutral**
Bearish
China Shanghai Index
2764, 0.00%
Neutral
Neutral
Gold
1239, 5.49%
Bullish
Bullish
WTIC Crude
29.02, -6.39%
Bearish
Bearish
Copper
2.03, -2.68%
Bearish
Bearish
Baltic Dry Index
291, -2.02%
Bearish
Bearish
Euro
1.132, 1.49%
Bullish
Bullish
Dollar/Yen
113.27, -3.10%
Bearish
Bearish
Dow Transports
7049, 1.52%
Bullish
Bullish
High Yield (ETF)
32.00, -0.93%
Bearish
Bearish
US 10 year Bond Yield
1.75%, -5.41%
Bullish
Bullish
Nyse Summation Index
-668, -19.37%
Bearish
Neutral
US Vix
25.40, 8.64%
Bearish
Bearish
20 DMA, S and P 500
1885, Below
Bearish
Neutral
50 DMA, S and P 500
1967, Below
Bearish
Neutral
200 DMA, S and P 500
2034, Below
Bearish
Neutral
20 DMA, Nifty
7361, Below
Neutral
Bearish
50 DMA, Nifty
7592, Below
Neutral
Bearish
200 DMA, Nifty
8028, Below
Neutral
Bearish
India Vix
24.67, 36.20%
Neutral
Bearish
Dollar/Rupee
68.12, 0.35%
Neutral
Neutral


Overall


S & P 500


Nifty

Bullish Indications

4

4
Bearish Indications
11
12
Outlook
Bearish
Bearish
Observation
The S and P 500 and the Nifty fell hard last week. Indicators are bearish. Market is oversold. A short term tradeable bottom may emerge soon.
On the Horizon
China - CPI, Japan – GDP, Euro zone – ZEW survey, U.K – CPI, U.S – CPI, Canada – CPI, Australia – Employment data
*Nifty
India’s Benchmark Stock Market Index
Raw Data
Courtesy Google finance, Stock charts, FXCM
**Neutral
Changes less than 0.5% are considered neutral


The US market and Nifty fell last week. Signals are bearish for the upcoming week. The markets are in oversold mode and are gearing up for another bounce, looking for a short term bottom to emerge soon near the 1800 mark on the S & P. The multi week up move in the transports is indicating a bounce maybe forth coming. The critical levels to watch are 1880 (up) and 1840 (down) on the S & P and 7000 (up) and 6800 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. You can check out last week’s report for a comparison. You can also check out snapshots of the S and P 500 and Nifty Indices. Love your thoughts and feedback.

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My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.