Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning June 05

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2439, 0.96%	Bullish	Bullish
Nifty	9654, 0.61%	Neutral **	Bullish
China Shanghai Index	3106, -0.15%	Neutral	Neutral
Gold	1280, 0.95%	Bullish	Bullish
WTIC Crude	47.66, -4.30%	Bearish	Bearish
Copper	2.57, 0.33%	Neutral	Neutral
Baltic Dry Index	830, -8.99%	Bearish	Bearish
Euro	1.1283, 0.88%	Bullish	Bullish
Dollar/Yen	110.42, -0.80%	Bearish	Bearish
Dow Transports	9332, 1.69%	Bullish	Bullish
High Yield (ETF)	37.28, 0.43%	Neutral	Neutral
US 10 year Bond Yield	2.16%, -4.04%	Bullish	Bullish
Nyse Summation Index	583, 7.34%	Bullish	Neutral
US Vix	9.75, -0.61%	Bullish	Bullish
Skew	124	Neutral	Neutral
20 DMA, S and P 500	2401, Above	Bullish	Neutral
50 DMA, S and P 500	2378, Above	Bullish	Neutral
200 DMA, S and P 500	2268, Above	Bullish	Neutral
20 DMA, Nifty	9481, Above	Neutral	Bullish
50 DMA, Nifty	9312, Above	Neutral	Bullish
200 DMA, Nifty	8743, Above	Neutral	Bullish
India Vix	10.81, -0.48%	Neutral	Neutral
Dollar/Rupee	64.26, -0.46%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	10	10
Bearish Indications	3	3
Outlook	Bullish	Bullish
Observation	The S and P 500 and the Nifty made new highs last week. Indicators are bullish. The market is at new highs. Time to tighten those stops.
On the Horizon	China – CPI, New loan data, Australia – Rate decision, GDP, Euro Zone –ECB rate decision, Draghi speech, U.S – ISM services, Canada – Employment data, Mexico – Local elections, India – RBI rate decision
*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, dailyfx.com
**Neutral	Changes less than 0.5% are considered neutral

 

The S and P 500 and the Nifty made new highs last week. Signals are bullish for the upcoming week. Past and future FED rate hikes are yet to be priced in and sentiment indicators are back in complacency mode. Market internals, the transports and commodities are flashing major warning signs of a large decline ahead. The critical levels to watch are 2450 (up) and 2430 (down) on the S & P and 9700 (up) and 9550 (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. Love your thoughts and feedback.