Blair Jensen | TalkMarkets | Page 4
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 view ...more

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Ray Of Hope
I’m starting to see a few rays of hope from various measures of breadth that could provide the fuel for a broad based rally.
Not Much Hope
Last week, we got that break and the S&P 500 Index finally made a clear move above 2400. Unfortunately, most of the bullishness was observation of new highs and not excitement for even higher prices.
Breakout Or Not Quite
We’ve got a break to new highs, but underlying technical indicators aren’t confirming the rally. Expect hard fought gains followed by choppy market action.
Waiting For Signs Of Bullishness
SPX is in a well defined range of 2300 to 2400 with minor support at the last lows near 2320. 7 day momentum and Twitter sentiment is in a clear short term downtrend. If the trend is broken to the upside it should confirm a resumption of the rally.
Continued Chop
The market is trying to break out, but breadth isn’t improving. This condition often results in a choppy market. If the market can break out then bulls want to see breadth improve or we risk a good size decline when the rally ends.
Breadth Not Improving
The market is trying to break out, but breadth isn’t improving. This condition often results in a choppy market. If the market can break out then bulls want to see breadth improve or we risk a good size decline when the rally ends.
Thinning Breadth Near All Time High
Support and resistance gleaned from Twitter for SPX shows a clear range between 2300 and 2400. If the market can get above 2400, it should move fairly quickly to 2450 as that area is getting calls from a large number of traders.
Ready For The Rally
SPX is getting ready to surge to new highs, but measures of breath aren’t confirming the move. If broad participation doesn’t accompany a break out, I suspect we may see a blow off type top.
Waiting For A Direction - Friday, April 21
My core indicators are compressing near zero. This indicates that market participants are waiting for a direction.
Still Looking Healthy But Risky, Too
Sentiment from Twitter is still healthy but there are danger signs. The healthy signs are less fear in price targets, 7 day momentum inside a bullish range and increase in the number of bullish stocks. The risk comes if the market can’t hold 2300.
Stock Market Sentiment Showing Strength On Twitter
I’m seeing some positive signs this week from stock market sentiment on Twitter. First, seven day momentum and sentiment for the SPX has broken its downtrend line. This often results in price moving higher because sentiment has turned bullish.
Core Market Health Indicators: Not Much Change
Over the past week, my core market health indicators mostly deteriorated, but not in a significant way. The other indicators I’m following aren’t showing any real weakness.
Not Much Change - Friday, March 31
One thing that is showing a lot of improvement is the NYSE cumulative Advance Decline Line (NYAD). It is leading price on the S&P 500 Index (SPX) and moving above its last high.
Warning Signs
We’re seeing some signs warning that sentiment for SPX​ gleaned from Twitter is at a make or break point. The thing that is most concerning is that price is so close to an all time high as sentiment is deteriorating toward bearish levels.
Measures Of Trend Fall Below Zero
My core indicators are tumbling one by one, perceptions of risk are rising, but breadth is holding up fairly well. At the moment, this looks like rotation rather than investors bracing for a storm.
Not Much Change - Sunday, March 19
Over the past week, there wasn't a lot news to report regarding sentiment from the Twitter stream. The most significant item comes from the number of bullish stocks which continues to fall even though the market moved up a bit.
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