Uh-oh - As the market steams along, is that an iceberg ahead?
Main U.S. indexes advance ahead of FOMC minutes at 2 PM ET
Financials lead S&P 500 gainers; Comm Svcs weakest group
Euro STOXX 600 index up ~0.7%
Dollar up; gold, bitcoin, crude dip
U.S. 10-Year Treasury yield edges up to ~4.05%
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UH-OH - AS THE MARKET STEAMS ALONG, IS THAT AN ICEBERG AHEAD?
The U.S. stock market remains constructive on a trend-following basis. However, analysts at SentimenTrader are concerned over the potential for rough seas ahead as several potential warning signs have appeared on the horizon.
"These signs do not necessarily scream 'Sell Everything,' but they do suggest that investors review their contingency plans and not assume that everything is 'smooth sailing' for stocks," writes senior research analyst Jay Kaeppel in a note.
One such warning sign Kaeppel is dredging up is the "Titanic Syndrome" indicator which was created by Bill Omaha in the 1960s.
It highlights a technical market condition when stocks have recently been at a high, and then new 52-week lows suddenly jump vs new 52-week highs, suggesting developing weakness under the surface.
More specifically, in this case, SentimenTrader is applying these conditions to the Nasdaq 100. A signal is generated when 1) the Nasdaq 100 .NDX closes at a 52-week high at some point in the past seven sessions, and 2) New 52-week lows outnumber 52-week highs on the Nasdaq.
Kaeppel says this is "not a precision timing tool," but a warning sign that typically precedes some form of trouble over the next 1-3 months. That said, in his opinion, signals like this do not constitute an outright "sell" signal.
However, Kaeppel believes they can remind us of the old adage, "Hope for the best, prepare for the worst."
"As long as the major market indexes hold above their longer-term moving averages, indicator signals like the above are more 'alerts' than 'warnings.' But if things start to break down, investors might be wise to have some contingency plans already in place to reduce risk."
Here is a chart using LSEG data showing the Nasdaq 100 and Titanic Syndrome signals:
(Terence Gabriel)
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FOR WEDNESDAY'S EARLIER LIVE MARKETS POSTS:
TOO HOT TO HANDLE: RISING MORTGAGE RATES PROMPT REFI DEMAND PLUNGE - CLICK HERE
U.S. STOCKS TICK UP AHEAD OF THE MINUTES - CLICK HERE
S&P 500 INDEX JUST SHY OF ITS RECORD HIGHS - CLICK HERE
BULLISH FACTORS BEHIND GOLD RALLY TO CONTINUE - UBS - CLICK HERE
U.S. ELECTION RISK RIPPLES THROUGH MEXICAN PESO OPTIONS - CLICK HERE
NO NEED TO PANIC AS TURBULENT EARNINGS SEASON LOOMS - CLICK HERE
STOXX INCHES UP, OFF 2-WEEK LOWS - CLICK HERE
EUROPEAN FUTURES POINT TO MUTED START - CLICK HERE
CHINA STOCKS GET A REALITY CHECK; EUROPE SHUDDERS - CLICK HERE
NDXTitanic10092024 https://tmsnrt.rs/3ZS5kLv
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Penafian: Entiti XM Group menyediakan perkhidmatan pelaksanaan sahaja dan akses ke Kemudahan Dagangan Atas Talian, yang membolehkan sesorang melihat dan/atau menggunakan kandungan yang ada di dalam atau melalui laman web, tidak bertujuan untuk mengubah atau memperluas, juga tidak mengubah atau mengembangkannya. Akses dan penggunaan tersebut tertakluk kepada: (i) Terma dan Syarat; (ii) Amaran Risiko; dan Penafian Penuh. Oleh itu, kandungan sedemikian disediakan tidak lebih dari sekadar maklumat umum. Terutamanya, perlu diketahui bahawa kandungan Kemudahan Dagangan Atas Talian bukan permintaan, atau tawaran untuk melakukan transaksi dalam pasaran kewangan. Berdagang dalam mana-mana pasaran kewangan melibatkan tahap risiko yang besar terhadap modal anda.
Semua bahan yang diterbitkan di Kemudahan Dagangan Atas Talian kami bertujuan hanya untuk tujuan pendidikan/maklumat dan tidak mengandungi – dan tidak boleh dianggap mengandungi nasihat kewangan, cukai pelaburan atau dagangan dan cadangan, atau rekod harga dagangan kami, atau tawaran, atau permintaan untuk suatu transaksi dalam sebarang instrumen kewangan atau promosi kewangan yang tidak diminta kepada anda.
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