Taking Sock - Week of January 25, 2021

Monday, January 25, 2021

Red Arrow Down

DJI30 Index at the close   —-   30,960.00   -36.98 (-0.12%)

The Index opened at 30990, off 7 points, and fell to 30775 before 10:00.  It recovered to 30925 a half hour later, but then dropped hard, citing the lo of 30564, off 433 points after 11:00.  It then climbed back, reaching 30950 after 1:30.  After a dip to 30850 at 3:15, it climbed 62 points into the close.

The loss was small, but the entire day was under water, and deeply negative by late morning.  This is a clearly down day, with the hi and lo lower by 152 and 344 points, respectively.  The span was 426 points, the largest since 710 on 1/06.  Surprisingly, the convergence of momentum measures stalled a bit, despite the small loss.

All the indexes had similar contours today.  The DJI never touched green.  The Russell 2000 started out positive, but slid into the red by mid-morning and never climbed out.  The S&P and NASDAQ hovered around neutral and wound up positive.

% Changes -

DJI30  -0.12% 

SP500 +0.36%   

NASDAQ  +0.69%    

Russell 2000 -0.25% 

DJI30 Closings -

01/25/19 - 24528

01/24/20 - 28990

12/24/20 - 30200

01/25/21 - 30960

NYSE Internals - 

A/D =  1320/1890 = 0.70

A/D Vol = 1.07

New Hi/Lo = 287/2 = 143.5

Tuesday, January 26, 2021

Yellow Arrow Sideways

DJI30 Index at the close   —-   30,937.04   -22.96 (-0.07%)

The Index opened at 30969, up 9 points. It quickly rose to the hi of 31121, up 161, then started to fall.  It hit 30931, off 29 points after 11:00, and again before 12:00, and yet again before 1:00.  From there, it rose to about 31015 after 2:00, hit that level again at 3:30, then dropped to the day’s lo of 30923, two minutes before the end of the session. 

The 23 point loss kept this from being a clearly up day.  The hi and lo were higher by 132 and 358 points, respectively.  The span was 200 points.  The momentum measures resumed converging.  I said a few days ago that it looks as if a broad top is forming.  I see nothing to make me reconsider that assessment.

All the indexes had similar contours that wrapped around neutral, and they all wound up slightly in the red, with the NASDAQ being the biggest loser.

% Changes -

DJI30  -0.07% 

SP500 -0.15%   

NASDAQ  -0.07%    

Russell 2000 -0.62% 

DJI30 Closings -

01/25/19 - 24528

01/24/20 - 28990

12/24/20 - 30200

01/25/21 - 30937

NYSE Internals - 

A/D =  1318/1857 = 0.71

A/D Vol = 0.91

New Hi/Lo = 147/3 = 49.00

Wednesday, January 27, 2021

Red Arrow Down

DJI30 Index at the close   —-   30,303.17 -633.87 (-2.05%)

The Index opened at 30894, off 43 points, and immediately dropped to 30590, off 347.  It continued to drop, bottoming at 30353, off 584 before 10:00.  Shorty after 11:00 it reached 30660, off 277.  It dropped to 30470 at noon, and arced between those two levels until 2:00 when it broke lower. It hit the day’s lo of 30207, off 730 points after 3:30 then rose 96 points into the close. 

This is a clearly down day, with the hi and lo lower by 228 and 715 points, respectively.  The spread was 687 points, the largest since 709 on 1/06, when the index rose by 630 points. Today’s close is the lowest since 1/05, and only 79 points above the 1/04 close.  It’s that close to going negative for the year.

It looks like the local top I’ve been predicting is in, and the momentum measures are now all pointing down.  I was expecting a more horizontal convergence, but with today’s dramatic drop the 5 day measure has fallen below the 34 day.  As always, follow through is important.  After a drop this dramatic, there might be a bounce tomorrow.  Nothing travels in a straight line.  But I suspect the Index will be lower by the end of the week.

All the indexes were down sharply, and none of them spent a moment in positive territory.

% Changes -

DJI30  -2.05% 

SP500 -2.57%   

NASDAQ  -2.61%    

Russell 2000 -1.91% 

DJI30 Closings -

01/25/19 - 24528

01/24/20 - 28990

12/24/20 - 30200

01/26/21 - 30303

NYSE Internals - 

A/D =  543/2677 = 0.20

A/D Vol = 0.80

New Hi/Lo = 118/33 = 3.58

Thursday, January 28, 2021

Green Arrow Up

DJI30 Index at the close   —-   30,603.36   +300.19 (+0.99%)

The Index opened at 30377, up 74 points, and quickly jumped up to 30570, up 267.  From there it was an arc-shaped climb to 30935, up 632 points from 12:00 to 12:30.  Then it began to arc back down, except for one weird spike of about 125 points to the day’s hi of 30951 that went up and down again between 2:17 to 2:22. After that the decline continued, and accelerated down into the close, including a drop of about 120 points in the last 7 minutes.

This is a clearly up day, with the hi and lo up by 58 and 170 points, respectively.  At the hi, all of yesterday’s loss had been recovered, but that position did not hold, and by the end of the day half the gain had been given back.  I see this, and especially the sharp drop at the end of the day, as bearish signs.  The graph from the beginning of the year resembles the down-sweep of an arc.  

I’ve forecast  impending declines before, and been wrong every time.  But this looks like the real thing.  Markets have been bubbly for a long time, and the decoupling from the economy has been stark.  But this can go on for a long time — until it suddenly doesn’t.  You know not when, and this is probably not a 1929 - or even Spring of 2020 - style crash.  But I think the next phase is down.

% Changes -

DJI30  +0.99% 

SP500 +.98%   

NASDAQ  +.50%    

Russell 2000 -0.10% 

DJI30 Closings -

01/28/19 - 24528

01/28/20 - 28723

12/28/20 - 30404

01/28/21 - 30603

NYSE Internals - 

A/D =  2213/970 = 2.28

A/D Vol = 1.34

New Hi/Lo = 62/9 = 6.89

Friday, January 29, 2021

Red Arrow Down

DJI30 Index at that close   —-   29,982.62   -620.74 (-2.03%)

The Index opened at 30554, the day’s hi, off 49 points, and hit a lo of 30192, off 411 ten minutes later.  It then started to climb, reaching 30487, off 136 a half hour after that.  But after 11:30. it reached a new lo of 30134, off 469.  It stayed above that level for a half hour, then resumed falling.  It hit the day’s low of 29856, off 747 points at 1:15.  From there it was a stepwise climb to 30200 at 3:30.  After that, there was a down-up-down 217 point drop into the close, including 165 points in the last 4 minutes, on a volume spike.  The close was below the 55 day EMA.

This is a clearly down day, with the hi and lo off by 398 and 521 points respectively.  This bear has sharp claws, and the mauling is nowhere near done.  Momentum is clearly down, and vertically so at short durations.

The Russell 2000 was in the green briefly at the beginning of the session before falling.  The other indexes were in the red all day, and all of them had similar contours.



The Friday to Friday loss was 3.27%

% Changes -

DJI30  -2.03% 

SP500 -1.93%   

NASDAQ  -2.00%    

Russell 2000 -1.56% 

DJI30 Closings -

01/29/19 - 24580

01/29/20 - 28723

12/29/20 - 30336

01/29/21 - 29983

NYSE Internals - 

A/D =  2213/970 = 2.28

A/D Vol = 1.34

New Hi/Lo = 62/9 = 6.89