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

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2786, 1.57%	Bullish	Bullish
Nifty	10681, 1.16%	Neutral **	Neutral
China Shanghai Index	3429, 2.56%	Bullish	Bullish
Gold	1335, 0.95%	Bullish	Bullish
WTIC Crude	64.30, 4.65%	Bullish	Bullish
Copper	3.22, -0.34%	Neutral	Neutral
Baltic Dry Index	1303, -2.83%	Bearish	Bearish
Euro	1.2199, 1.41%	Bullish	Bullish
Dollar/Yen	111.00, -1.84%	Bearish	Bearish
Dow Transports	11373, 4.23%	Bullish	Bullish
High Yield (ETF)	36.86, -0.46%	Neutral	Neutral
US 10 year Bond Yield	2.55%, 3.07%	Bearish	Bearish
Nyse Summation Index	710, 11.01%	Neutral	Bullish
US Vix	10.16, 10.20%	Bearish	Bearish
Skew	125	Neutral	Neutral
20 DMA, S and P 500	2707, Above	Bullish	Neutral
50 DMA, S and P 500	2649, Above	Bullish	Neutral
200 DMA, S and P 500	2500, Above	Bullish	Neutral
20 DMA, Nifty	10510, Above	Neutral	Bullish
50 DMA, Nifty	10367, Above	Neutral	Bullish
200 DMA, Nifty	9891, Above	Neutral	Bullish
India Vix	13.73, 4.73%	Neutral	Bearish
Dollar/Rupee	63.52, 0.36%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	9	10
Bearish Indications	4	5
Outlook	Bullish	Bullish
Observation	The S and P 500 and the Nifty made new highs last week. Indicators are bullish. A major market top is near. Time to watch those stops.
On the Horizon	Australia – Employment data, China – GDP, Industrial production, Euro Zone – CPI, UK – CPI, Retail sales, U.S – Oil inventories, Canada – Rate decision
*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, investing.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. Quantitative tightening by the FED is yet to be priced in and sentiment indicators are back in complacency mode. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. Divergences in high yields and surging bond yields are flashing some warning signs. The critical levels to watch are 2795 (up) and 2775(down) on the S & P and 10750 (up) and 10600 (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.

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning January 08

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2743, 2.60%	Bullish	Bullish
Nifty	10559, 0.27%	Neutral **	Neutral
China Shanghai Index	3392, 2.56%	Bullish	Bullish
Gold	1322, 0.99%	Bullish	Bullish
WTIC Crude	61.44, 1.69%	Bullish	Bullish
Copper	3.23, -2.15%	Bearish	Bearish
Baltic Dry Index	1341, -1.83%	Bearish	Bearish
Euro	1.2029, 0.20%	Neutral	Neutral
Dollar/Yen	113.08, 0.37%	Neutral	Neutral
Dow Transports	10912, 2.82%	Bullish	Bullish
High Yield (ETF)	37.03, 0.84%	Bullish	Bullish
US 10 year Bond Yield	2.48%, 2.95%	Bearish	Bearish
Nyse Summation Index	639, 14.27%	Neutral	Bullish
US Vix	9.22, -16.49%	Bullish	Bullish
Skew	127	Neutral	Neutral
20 DMA, S and P 500	2681, Above	Bullish	Neutral
50 DMA, S and P 500	2630, Above	Bullish	Neutral
200 DMA, S and P 500	2489, Above	Bullish	Neutral
20 DMA, Nifty	10413, Above	Neutral	Bullish
50 DMA, Nifty	10340, Above	Neutral	Bullish
200 DMA, Nifty	9851, Above	Neutral	Bullish
India Vix	13.11, 3.49%	Neutral	Bearish
Dollar/Rupee	63.29, -0.85%	Neutral	Bullish
Overall	S & P 500	Nifty
Bullish Indications	9	12
Bearish Indications	3	4
Outlook	Bullish	Bullish
Observation	The S and P 500 and the Nifty made new highs last week. Indicators are bullish. The market is topping. Time to watch those stops.
On the Horizon	Australia – Retail sales, Euro Zone – ECB minutes, CPI, UK – Manufacturing production data, U.S – Oil inventories, PPI, CPI, Retail sales
*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, investing.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. Quantitative tightening by the FED is yet to be priced in and sentiment indicators are back in complacency mode. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. The critical levels to watch are 2755 (up) and 2735(down) on the S & P and 10650 (up) and 10450 (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.