Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning April 23

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2670, 0.52%	Bullish	Bullish
Nifty	10564, 0.80%	Neutral **	Bullish
China Shanghai Index	3072, -2.77%	Bearish	Bearish
Gold	1338, -0.71%	Bearish	Bearish
WTIC Crude	68.40, 1.50%	Bullish	Bullish
Copper	3.13, 2.08%	Bullish	Bullish
Baltic Dry Index	1201, 20.95%	Bullish	Bullish
Euro	1.2304, -0.32%	Neutral	Neutral
Dollar/Yen	107.60, 0.23%	Neutral	Neutral
Dow Transports	10579, 2.02%	Bullish	Bullish
High Yield (ETF)	35.99, -0.47%	Neutral	Neutral
US 10 year Bond Yield	2.95%, 4.31%	Bearish	Bearish
Nyse Summation Index	262, 132.95%	Bullish	Neutral
US Vix	16.88, -3.04%	Bullish	Bullish
Skew	133	Neutral	Neutral
20 DMA, S and P 500	2645, Above	Bullish	Neutral
50 DMA, S and P 500	2687, Below	Bearish	Neutral
200 DMA, S and P 500	2606, Above	Bullish	Neutral
20 DMA, Nifty	10332, Above	Neutral	Bullish
50 DMA, Nifty	10364, Above	Neutral	Bullish
200 DMA, Nifty	10242, Above	Neutral	Bullish
India Vix	12.94, -8.50%	Neutral	Bullish
Dollar/Rupee	66.19, 1.52%	Neutral	Bearish
Overall	S & P 500	Nifty
Bullish Indications	9	11
Bearish Indications	4	4
Outlook	Bullish	Bullish
Observation	The S and P 500 and the Nifty rallied last week. Indicators are bullish. The markets have made important tops. Time to watch those stops.
On the Horizon	Australia – CPI, Japan – BoJ rate decision, GDP, Euro Zone – German PMI, German IFO business climate index, German employment data, ECB rate decision, UK- GDP, Retail sales, U.S – Home sales, Consumer confidence, Oil inventories, Durable goods, GDP, Canada – Poloz speech, Russia – 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

Chart courtesy David Rosenberg 

The S and P 500 and the Nifty rallied last week. Indicators are bullish for the upcoming week. Quantitative tightening by the FED is yet to be priced in fully. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. Indian market volatility is still well below US market volatility as the nifty is close to resistance while the US market has hit resistance and turned down. The critical levels to watch are 2680 (up) and 2660 (down) on the S & P and 10650 (up) and 10500 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. A combination of higher bond yields and high valuations could pose major challenges going forward.  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 April 16

Indicator	Weekly Level / Change	Implication for S & P 500	Implication for Nifty*
S & P 500	2656, 1.99%	Bullish	Bullish
Nifty	10481, 1.44%	Neutral **	Bullish
China Shanghai Index	3159, 0.89%	Bullish	Bullish
Gold	1348, 0.88%	Bullish	Bullish
WTIC Crude	67.39, 8.59%	Bullish	Bullish
Copper	3.07, 0.41%	Neutral	Neutral
Baltic Dry Index	993, 4.20%	Bullish	Bullish
Euro	1.2344, 0.42%	Neutral	Neutral
Dollar/Yen	107.35, 0.41%	Neutral	Neutral
Dow Transports	10370, 2.20%	Bullish	Bullish
High Yield (ETF)	36.16, 1.18%	Bullish	Bullish
US 10 year Bond Yield	2.78%, 1.24%	Bearish	Bearish
Nyse Summation Index	113, 262.20%	Bullish	Neutral
US Vix	17.41, -18.99%	Bullish	Bullish
Skew	126	Neutral	Neutral
20 DMA, S and P 500	2649, Above	Bullish	Neutral
50 DMA, S and P 500	2690, Below	Bearish	Neutral
200 DMA, S and P 500	2599, Above	Bullish	Neutral
20 DMA, Nifty	10243, Above	Neutral	Bullish
50 DMA, Nifty	10400, Above	Neutral	Bullish
200 DMA, Nifty	10216, Above	Neutral	Bullish
India Vix	14.14, -4.12%	Neutral	Bullish
Dollar/Rupee	65.20, 0.48%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	11	13
Bearish Indications	2	1
Outlook	Bullish	Bullish
Observation	The S and P 500 and the Nifty rallied last week. Indicators are bullish. The markets have made important tops. Time to watch those stops.
On the Horizon	Australia – RBA minutes, Employment data, New Zealand – CPI, China – Industrial production, GDP, Euro Zone – German ZEW economic sentiment, CPI, UK- Employment data, CPI, Retail sales, U.S – Retail sales, Oil inventories, Canada – BOC rate decision, 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

Chart courtesy David Rosenberg 

The S and P 500 and the Nifty rallied last week. Indicators are bullish for the upcoming week. Quantitative tightening by the FED is yet to be priced in fully. The markets are still trading well over 3 standard deviations above their long term averages from which corrections usually result. Indian market volatility is still well below US market volatility as the nifty is close to resistance while the US market is close to major support so there is complacency and some catch up left on the down side in India. The critical levels to watch are 2670 (up) and 2645 (down) on the S & P and 10550 (up) and 10400 (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.

Stock Market - The Good, The Bad and The Ugly

The good first:

The market seems to be holding the 200 DMA despite excessive bearishness and negative vibes surrounding the trade war with China and the special counsel investigation involving president Trump:

The bad:
Valuations are still in the stratosphere and market volatility is on the rise:

Chart courtesy Jill Mislinski via Advisor Perspectives

The ugly:
If the market where to break support here near the 200 DMA there is loads of downside ahead and parallels to earlier market melt downs are well worth watching:

Chart courtesy David Rosenberg:

Image from imdb.com