The new highs are off the charts the most since June 2016. The Federal Reserve and other global central banks have goosed stock markets into the clouds for almost 11 years running; everyday is a big party. The Dow Jones Industrials should print a new all-time high this morning joining the SPX and the Nazzy indexes, however, the NYA, RUT and TRAN are not at their new record highs.
The new highs minus the new lows are at a lofty 375 above the new highs that occurred back in January 2018. On 1/8/18, the NYHL prints the record high. On 1/22/18, the NYA begins crashing and lost -9.5% over the next two weeks. So it took two weeks after the high NYHL signal for stocks to peak and then plummet. That January was a euphoric high, like now. Everyone is in good spirits expecting more new highs, especially now with traders expecting a rally into the end of this year.
The red bubbles show stock market tops when the euphoria is at an extreme and new highs are printing like crazy as investors chase stocks higher willing to pay any price. Traders are afraid of missing out on this new breakout that is touted daily in the media. The green bubbles show where strong rallies begin because stocks are washed-out with new lows at excessive levels. What do you think will happen?
On Monday, 11/4/19, about three hours before the opening bell for the regular US trading session, US futures are joyous after Commerce Secretary Ross opines about an optimistic trade deal with the communists. S&P +16. Dow +133. Nasdaq +53. Russell +8. Oddly, the VIX moves higher to 12.57. The Dow is set to print a new all-time high at the opening bell. The SPX, COMPQ and NDX will also print record highs. Futures are up but volatility (VIX) is also higher. One of them is wrong. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added Tuesday Morning, 11/5/19, at 4:55 AM EST: The NYHL pops to 433 as the Dow Jones Industrials print new all-time highs overtaking the July highs. The SPX and Nazzy indexes print new records. The party is in full swing. Traders are drunk as skunks off Fed wine, BOJ sake, ECB champagne and PBOC rice wine buying stocks while singing and dancing. The central bankers are the market. The happy US-China trade talk continues. The idiots are spending time discussing where President's Trump and Xi will sign the phase one deal instead of discussing how to address intellectual property (IP) theft and enforcement of trade violations. Politicians are publicity hounds. Soybean Donny needs a political win and something to tout for the campaign so soybeans it will be. Too bad many farmers have already gone bankrupt. New tariffs are slated for 12/15/19 so that is the drop-dead date for the phase one deal to be signed and cast in stone; so within 39 days. It is smelling like a sell-the-news event. The CPC put/call ratio drops to 0.65 a low not seen since the stock market topped-out and then crashed in January 2018. The complacency is rampant. Everyone is telling each other how the stock market will continue rallying into the end of the year. The bears have all left town. Traders are in a happy mood buying stocks with reckless abandon as they eat Fed ice cream with China trade deal sprinkles on top. It will be entertaining to watch in the coming days.
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