|
Indicator |
Weekly
Level / Change |
Implication
for S
& P 500 |
Implication
for Nifty* |
|
S
& P 500 |
4020,
1.14% |
Bullish |
Bullish |
|
Nifty |
14867,
2.48% |
Neutral
** |
Bullish |
|
China
Shanghai Index |
3484,
1.93% |
Bullish |
Bullish |
|
Gold |
1731,
-0.11% |
Neutral |
Neutral |
|
WTIC
Crude |
61.30,
0.54% |
Bullish |
Bullish |
|
Copper |
4.02,
-1.30% |
Bearish |
Bearish |
|
Baltic
Dry Index |
2072,
-4.87% |
Bearish |
Bearish |
|
Euro |
1.1764,
-0.27% |
Neutral |
Neutral |
|
Dollar/Yen |
110.71,
0.97% |
Bullish |
Bullish |
|
Dow
Transports |
14748,
0.98% |
Bullish |
Bullish |
|
High
Yield (Bond ETF) |
108.64,
0.12% |
Neutral |
Neutral |
|
US
10 year Bond Yield |
1.71%,
2.49% |
Bearish |
Bearish |
|
NYSE
Summation Index |
501,
-2.33% |
Bearish |
Neutral |
|
US
Vix |
17.33,
-8.11% |
Bullish |
Bullish |
|
Skew |
136 |
Neutral |
Neutral |
|
20
DMA, S and P 500 |
3930,
Above |
Bullish |
Neutral |
|
50
DMA, S and P 500 |
3888,
Above |
Bullish |
Neutral |
|
200
DMA, S and P 500 |
3553,
Above |
Bullish |
Neutral |
|
20
DMA, Nifty |
14836,
Above |
Neutral |
Bullish |
|
50
DMA, Nifty |
14748,
Above |
Neutral |
Bullish |
|
200
DMA, Nifty |
12496,
Above |
Neutral |
Bullish |
|
S
& P 500 P/E |
40.93 |
Bearish |
Neutral |
|
Nifty
P/E |
33.60 |
Neutral |
Bearish |
|
India
Vix |
19.99,
-3.21% |
Neutral |
Bullish |
|
Dollar/Rupee |
73.39,
1.07% |
Neutral |
Bearish |
|
Overall |
S
& P 500 |
Nifty |
|
|
Bullish
Indications |
9 |
11 |
|
|
Bearish
Indications |
5 |
5 |
|
|
Outlook |
Bullish |
Bullish |
|
|
Observation |
The
S and P and the Nifty rallied last week. Indicators are bullish for the week. The
markets are about to begin a great
depression style collapse. Watch those stops. |
||
|
On
the Horizon |
US – PPI, India - RBI rate decision |
||
|
*Nifty |
India’s
Benchmark Stock Market Index |
||
|
Raw
Data |
Courtesy
Stock charts, investing.com, multpl.com, NSE |
||
|
**Neutral |
Changes
less than 0.5% are considered neutral |
The S and P and the Nifty rallied
last week. Indicators are bullish for the week. Deflationary busts often begin
with inflation scares (the market is calling the Fed’s bluff) and gold is
telegraphing just that. Corporate bonds
are flashing early warning signs. The
epic crash signal is alive and well with retail, hedge funds, and speculators
all in, despite the recent melt-up and break out of the long-term broadening
top, suggesting a major top is imminent. The moment of reckoning is very
near. Technicals are about to track
fundamentals and turn bearish. The market is yet to price in one of the worst
earnings decline periods in stock market history. With extremely high
valuations, a crash is on the menu. Extremely low volatility suggests complacency
and downside ahead.
We rallied 46% right after the great
depressions (1930’s) first collapse and we have rallied over 80% in our most
recent rally of the lows in the last 12 month period. After extreme euphoria
for the indices, a highly probable selloff to the 3000 area is emerging on the
S and P, and 10000 should arrive on the Nifty in the next few months. The FED
is repeating the Japan experiment and the 3 lost decades in Japan (1989-2019)
is set to repeat across the globe. SPX 1500 and lower in a year and we stay
there till 2030, scary? The markets are very close to an epic meltdown and the
SPX is headed way lower.
The markets are overvalued,
overbought and out of touch with economic realities. Long term, the epic
meltdown is set to continue resulting in a 5 year plus bear market with lot
lower levels may be as low as 800 on the S and P. QE forever from the FED is
about to trigger the deflationary collapse of the century as we make a major
top in global equity markets. The market is looking like the short of a
lifetime with topping action in the transports, other global indices, and
commodities. High valuations continue.
The recent global virus epidemic
(black swan) has dented global GDP significantly and will usher in a depression
much faster than most think. The trend is about to change from bullish to
bearish and the markets are about to get smashed by a rebounding dollar.
Looking for significant underperformance in the Nifty going forward on rapidly
deteriorating macros. A 5-year deflationary wave has started in key asset classes
like the Euro, stocks, and commodities amidst several bearish divergences and
overstretched valuations.
We are entering a multi-year great depression. The markets are
still trading well over 3 standard deviations above their long-term averages
from which corrections usually result. Tail risk has been very high of late as interest
rates are about to plunge yet again reflecting a major recession. The critical
levels to watch for the week are 4030
(up) and 4010 (down) on the S & P 500 and 14950 (up) and 14800 (down)
on the Nifty. A significant breach
of the above levels could trigger the next big move in the above markets. China, Gold, Bonds, and the Nasdaq are
on Ichimoku sell signals while the Dollar, S & P 500, and Nifty are on Ichimoku buy signals so somethings got
to give. High beta / p/e is about to get torched in April. You can check out last week’s report for a comparison. Love your
thoughts and feedback.
