Blair Jensen Blog | Talkmarkets | Page 1
President of Downside Hedge
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Blair Jensen is President of Downside Hedge which provides market commentary and hedging strategies for individual investors. His development of a stock market sentiment indicator based on the Twitter stream is changing the way investors and traders ... more

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Market Quality Goes Positive
Over the past week my measures of market quality have gone positive.
Strengthening Indicators
All of my market health indicators are strengthening. Most notably my measures of risk and strength have moved from negative to positive.
Risk Warning Cleared
On Friday my market risk indicator cleared its warning. The core market health indicators are usually much slower to clear so they’re still mostly negative.
Market Risk Warning Clears
Most of my core market health indicators have strengthened. However, my core measures of risk still haven’t recovered.
Warning Still In Effect
The S&P 500 Index (SPX) is consolidating along its 50 day moving average. A significant move above it would almost certainly clear the market risk warning.
Market Risk Warning - Friday, Feb. 9
Market risk warnings come in two varieties. Ones that last for only a week or two (a false signal) and ones that last for several months (a significant correction or bear market).
Diverging Indicators
The market risk, economy, and strength categories are soaring higher, while the market quality and trend categories are lagging substantially.
Consolidation Likely
Last week, I mentioned that it might be time for some consolidation. This week, it appears more likely. My measures of market quality have dipped below zero and my measures of market trend are dropping pretty fast.
Breadth Declining
The market keeps working its way higher, but the bearish count is rising. Overall sentiment for SPX is very optimistic, but has been in a fairly solid range between 2550 and 2600 on SPX.
Markets: More Of The Same
My core market health indicators bounced around a bit this week, but they’re all still positive.
Onward And Upward
My core measures of risk fell slightly this week. That isn’t normal when the market is making new highs.
Lack Of Enthusiasm
This rally lacks enthusiasm from traders and investors on Twitter. Sentiment for the S&P 500 Index (SPX) didn’t move higher as the market finally jumped on Friday.
Sideways Consolidation
The S&P 500 Index (SPX​) is consolidating in a sideways range. As SPX consolidates, sentiment from the Twitter stream is painting a triangle. The break of the triangle will point the next direction in the market.
2550 And 2600 Resistance
For the S&P 500 Index (SPX) 2600 is the next resistance level if 2550 can be cleared with maybe a small stall in the 2565 to 2575 area.
Jump In Market Health
This week I am getting confirmation of the rally with all of my core market health indicators jumping substantially.
Everyone Waiting
Sentiment is decreasing as the market stalls. This is a normal condition that should result in the market resuming higher after 7 day sentiment hits the zero line or dips a bit lower into the oversold area.
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