Chart of the Day - Bear Market Probability

The chart of the day is courtesy of Econmatters that shows bear market probabilities for the US stock market S & P 500 Index. The chart shows that despite the recent rally, the probability of a bear market is still pretty high:

Chart of the Day - Global Central Bank Interest Rates

The chart of the day is courtesy of The Telegraph and discussed by Sol Palha on Safehaven, that shows several Global Central Banks have embraced very low interest rate or even Negative Interest Rate Policies (NIRP) to try and arrest deflation and fuel growth. The jury is out on whether this would work long term as such an experiment in Japan is ending in failure.

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning April 4

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2073, 1.81%	Bullish	Bullish
Nifty	7713, -0.04%	Neutral**	Neutral
China Shanghai Index	3010, 1.64%	Bullish	Bullish
Gold	1223, 0.53%	Bullish	Bullish
WTIC Crude	36.63, -7.48%	Bearish	Bearish
Copper	2.17, -3.08%	Bearish	Bearish
Baltic Dry Index	450, 12.22%	Bullish	Bullish
Euro	1.138, 1.83%	Bullish	Bullish
Dollar/Yen	111.60, -1.12%	Bearish	Bearish
Dow Transports	7888, -0.48%	Neutral	Neutral
High Yield (ETF)	34.14, 0.51%	Bullish	Bullish
US 10 year Bond Yield	1.79%, -5.68%	Bullish	Bullish
Nyse Summation Index	1076, 8.67%	Bullish	Neutral
US Vix	13.10, -11.13%	Bullish	Bullish
20 DMA, S and P 500	2030, Above	Bullish	Neutral
50 DMA, S and P 500	1958, Above	Bullish	Neutral
200 DMA, S and P 500	2016, Above	Bullish	Neutral
20 DMA, Nifty	7575, Above	Neutral	Bullish
50 DMA, Nifty	7384, Above	Neutral	Bullish
200 DMA, Nifty	7893, Below	Neutral	Bearish
India Vix	17.28, 5.71%	Neutral	Bearish
Dollar/Rupee	66.23, -1.02%	Neutral	Bullish
Overall	S & P 500	Nifty
Bullish Indications	12	10
Bearish Indications	3	5
Outlook	Bullish	Bullish
Observation	The Sand P 500 rallied and the Nifty was unchanged week. Indicators are bullish. Markets are back at resistance. Time to tighten those stops as downside may resume any moment.
On the Horizon	Australia – Rate decision, U.S –ISM non manufacturing, Yellen Speech, Canada – Employment data, India - RBI Rate decision
*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 rallied and the Nifty was unchanged last week. Signals are bullish for the upcoming week. Transports are diverging and the Vix is suggesting complacency. The markets are back at resistance and are likely to continue major breakdowns in 2016 as the recent rally has almost concluded. A big move is imminent.  The critical levels to watch are 2080 (up) and 2060 (down) on the S & P and 7750 (up) and 7650 (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.