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Bullish Tape Action Is All About Central Banks
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March 18, 2016

Tuesday, March 22

To our awesome readers and members in the US, Canada, Asia, and Europe:

Dave is still on the mend. Dave's Daily posts will remain intermittent and brief this week. Thank you for all your emails of well wishes and rallying support. Our deepest condolences to the innocent victims and families in the Brussels airport bombing terror attack.

ETF Digest Admin Team

Frankly, you either accept this wisdom or you rage at the machine. If you don’t go with it, then you won’t make money in this market.

Since I’ve been out of pocket given health issues, I’ll rely on math from the Zero Hedge below. Drawing the obvious conclusion from these two charts doesn’t take a genius.

3-18-2016 3-44-05 PM

 

3-18-2016 3-44-33 PM

Elsewhere the comedy of oil price movements is unmatched by the news. Below is the farce that is the reasoning for higher prices now from quotes Friday by so-called experts from Reuters: 

"Focus for now is firmly placed on a global macroeconomic environment that is propelling other industrial commodities such as the metals as well as world equities back to around highest levels since late last year," said Jim Ritterbusch of Chicago-based energy markets consultancy Ritterbusch & Associates. (This is Orwellian double talk.)

OPEC kingpin Saudi Arabia and non-OPEC producers led by Russia will meet in Qatar on April 17 to further the initiative that could result in the first global oil supply deal in 15 years. (They’ll mouth a bullish policy which then they’ll secretly start cheating.) U.S. crude inventories hit a fifth straight week of record highs last week but the build of 1.3 million barrels was less than half of forecasts.

Focus for now is firmly placed on a global macroeconomic environment that is propelling other industrial commodities such as the metals as well as world equities back to around highest levels since late last year," said Jim Ritterbusch of Chicago-based energy markets consultancy Ritterbusch & Associates.”

Stocks were mixed most of the day but then took off as Quad-Witching action kicked-in. It’s real but just a mechanical even not related to anything else. As I indicated yesterday bulls are back to their “bad news is good” ways. Today important Consumer Sentiment data, down to 90 from 92.7 expected & prior 91.7.

Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red). (Oh, Oh, Finviz Market Data isn’t working as of this posting. It just shows you not to rely on any one source.) 

3-18-2016 3-45-09 PM

Volume was heavy which is common on Quad-Witching and breadth per the WSJ was positive.

3-18-2016 3-45-39 PM

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12-17-2015 9-04-44 PM Chart of the Day

 

 

 

 

3-18-2016 5-13-19 PM RSP

 

 

 

Charts of the Day
  • SPY 5 MINUTE

    SPY 5 MINUTE

  • SPX DAILY

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  • SPX WEEKLY

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  • INDU DAILY

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  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • NDX WEEKLY

    NDX WEEKLY

  • NYMO DAILY

    NYMO DAILY

    The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

  • NYSI DAILY

    NYSI DAILY

    The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.


     

  • VIX WEEKLY

    VIX WEEKLY

    The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation has changed due to a variety of new factors including HFTs, new VIX linked ETPs and a multitude of new products to leverage trading and change or obscure prior VIX relevance.


     

 

A close friend told me: “I don’t understand this market.” I agree, but if you merge the tape with central bank schemes to push markets higher, you’ll be better off at least in cause and effect. And if the this causes you to vomit, I would fully understand.

For us, I have to hold my nose and go with the trend—it’ my job. Inform but go with your system’s dictates.

Let’s see what happens. 

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Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.

Named as one of the Top 22 ETF Experts You Need To Follow on Twitter for continuing to deliver high quality analysis and commentary through the ETFDigest Twitter feed.

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