Today Technology (XLK) triggered a Price Momentum Oscillator (PMO) BUY Signal. The PMO is flat above the signal line and that does imply pure strength. This breakout is a new all-time high for XLK. A few notes of caution need to be discussed. First, the RSI is now in overbought territory and that usually means an upcoming decline or at least consolidation. We do have strong participation readings, but we see that %Stocks > 20/50EMAs have negative divergences with price. Additionally, the Silver Cross Index is topping below the signal line.
Price has now broken above the bearish rising wedge which is especially bullish. The weekly PMO is rising strongly on a Crossover BUY Signal. Intermediate-term it looks good, but we are concerned with overbought readings that could imply a possible reversal.
The DecisionPoint Alert Weekly Wrap presents an end-of-week assessment of the trend and condition of the Stock Market, the U.S. Dollar, Gold, Crude Oil, and Bonds. The DecisionPoint Alert daily report (Monday through Thursday) is abbreviated and gives updates on the Weekly Wrap assessments.
MARKET/INDUSTRY GROUP/SECTOR INDEXES
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THE MARKET (S&P 500)
IT Trend Model: NEUTRAL as of 3/4/2025
LT Trend Model: SELL as of 4/16/2025
SPY 10-minute Chart: Price didn't do much today, the market drifted lower most of the day. A late day rally put price in positive territory. The 10-minute PMO does appear to be crossing above its signal line and Stochastics did tip upward, but price looks toppy to us.
SPY Daily Chart: We nearly reached all-time highs today. This is when the last rally failed so we should be mindful this resistance could start to put downside pressure on price. The PMO is on a Crossover SELL Signal currently, but we do have to note that it is flat above the signal line and that implies strength.
The VIX held above its moving average on the inverted scale and did not puncture the upper Bollinger Band which is bullish. Stochastics are back above 80 implying internal strength.
S&P 500 New 52-Week Highs/Lows: New Highs expanded on the decline, but we also saw a few New Lows. The High-Low Differential turned up today but it is still rather flat and unimpressive.
Climax* Analysis: There was only one climax reading on the four relevant indicators today. SPX Total Volume contracted to below the one-year daily average volume. It's not a climax day.
*A climax is a one-day event when market action generates very high readings in, primarily, breadth and volume indicators. We also include the VIX, watching for it to penetrate outside the Bollinger Band envelope. The vertical dotted lines mark climax days -- red for downside climaxes, and green for upside. Climaxes are at their core exhaustion events; however, at price pivots they may be initiating a change of trend.
Short-Term Market Indicators: The short-term market trend is UP and the condition is NEUTRAL.
The Swenlin Trading Oscillators (STOs) continue to rise bullishly, but we still note that there are negative divergences on both. Participation was shaved today and we lost quite a few rising PMOs. %PMOs Rising is now below our bullish 50% threshold.
Intermediate-Term Market Indicators: The intermediate-term market trend is UP and the condition is NEUTRAL.
The ITBM held the same value as yesterday and thus is acting toppy. The ITVM did continue to make its way higher, but notice the negative divergences with price. %PMO Xover BUY Signals dropped below the signal line today.
PARTICIPATION CHART (S&P 500): The following chart objectively shows the depth and trend of participation for the SPX in two time frames.
- Intermediate-Term - the Silver Cross Index (SCI) shows the percentage of SPX stocks on IT Trend Model BUY signals (20-EMA > 50-EMA). The opposite of the Silver Cross is a "Dark Cross" -- those stocks are, at the very least, in a correction.
- Long-Term - the Golden Cross Index (GCI) shows the percentage of SPX stocks on LT Trend Model BUY signals (50-EMA > 200-EMA). The opposite of a Golden Cross is the "Death Cross" -- those stocks are in a bear market.
The market bias is BEARISH in the intermediate term.
The market bias is BULLISH in the long term.
Participation backed off quite a bit on a day where we closed in positive territory. Readings a moderately bullish as they are holding above our bullish 50% threshold. The Silver Cross Index has topped beneath the signal line which is very bearish to us. The Golden Cross Index held its value today so it could be ready to top. The Silver Cross Index is below its signal line so the IT Bias is BEARISH. The Golden Cross Index is above its signal line so the LT Bias is BULLISH.
BIAS Assessment: The following table expresses the current BIAS of various price indexes based upon the relationship of the Silver Cross Index to its 10-day EMA (intermediate-term), and of the Golden Cross Index to its 20-day EMA (long-term). When the Index is above the EMA it is bullish, and it is bearish when the Index is below the EMA. The BIAS does not imply that any particular action should be taken. It is information to be used in the decision process.
The items with highlighted borders indicate that the BIAS changed today.
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CONCLUSION: The market may've finished higher, but it is acting toppy. Our primary indicators hold negative divergences with price so while most are rising, there is still trouble brewing. The Silver Cross Index has topped beneath its signal line and participation really took a hit especially considering we did end up with a positive close. We're starting to see a breakdown in rising PMOs and PMO BUY Signals. That is short-term bearish. We liked what we were seeing yesterday, but today doubts are crowding in. The market could be ready to top. We have quite a few economic reports coming out tomorrow and that could mean a bumpy ride.
Erin is 50% long, 0% short. (This is intended as information, not a recommendation.)
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CALENDAR
BITCOIN
We were concerned about the bearish double top that had developed, but now we're starting to see this as a bull flag. The PMO has turned up and Stochastics are rising strongly. We think Bitcoin could be ready to rally back to all-time highs.
BITCOIN ETFs
INTEREST RATES
Yields were mixed today. Declining trends are intact so we suspect there is more downside ahead. However, we are on the lookout for an upside reversal given the $TNX chart.
The Yield Curve Chart from StockCharts.com shows us the inversions taking place. The red line should move higher from left to right. Inversions are occurring where it moves downward.
10-YEAR T-BOND YIELD
As noted above, we are bearish on yields currently, but given the bullish falling wedge formation, we are on the lookout for an upside reversal. Today saw a bearish filled black candlestick so we would look for more decline. The PMO has dropped beneath the zero line implying weakness and Stochastics are well below 20 suggesting internal weakness.
BONDS (TLT)
IT Trend Model: SELL as of 4/14/2025
LT Trend Model: SELL as of 12/13/2024
TLT Daily Chart: With yields still in pullback mode, Bonds are doing just fine. The PMO has just moved into positive territory and Stochastics are back above 80. The bearish rising wedge suggests to us that upside potential is likely limited.
DOLLAR (UUP)
IT Trend Model: NEUTRAL as of 3/5/2025
LT Trend Model: SELL as of 4/25/2025
UUP Daily Chart: The Dollar remains in an intermediate-term declining trend. Support is currently holding, but today saw a PMO Crossover SELL Signal. Stochastics also look very weak. This support level is very vulnerable.
The bullish double bottom pattern appears ready to bust already. We do see strong support available at 26.75 should the current level not hold.
GOLD
IT Trend Model: BUY as of 1/10/2025
LT Trend Model: BUY as of 10/20/2023
GLD Daily Chart: Gold rallied on the Dollar's weakness. The rising trend has been compromised, but the 50-day EMA is still holding up as support. We have a flat top on price with rising bottoms and that is a bullish ascending triangle. The drop below the rising trendline does make the pattern suspect. Based on the PMO and Stochastics we should be looking for lower prices, but the Dollar looks particularly weak right now so we could see a bit more upside here.
Price is dropping back into a declining trend channel which isn't good, but we'll be watching support at the 50-day EMA to give us guidance.
GOLD MINERS (GDX) Daily Chart: Gold has some opportunity to rise from here and that will be good for Gold Miners, but right now the indicators are not favoring a rally. The PMO is falling on a Crossover SELL Signal and Stochastics are in negative territory and falling. As with Gold, we will be watching how price reacts at the 50-day EMA to give us a hint at where GDX might go.
CRUDE OIL (USO)
IT Trend Model: BUY as of 6/11/2025
LT Trend Model: SELL as of 3/18/2025
USO Daily Chart: Crude Oil rallied, but it wasn't much of a snapback. This decline looks overdone and while the PMO is falling, we think we could see some more rally. $OVX is back above its moving average on the inverted scale and that is bullish. Stochastics look terrible, but we're thinking price will rebound off the 50-day EMA.
Good Luck & Good Trading!
Erin Swenlin and Carl Swenlin
Technical Analysis is a windsock, not a crystal ball. --Carl Swenlin
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NOTE: The signal status reported herein is based upon mechanical trading model signals, specifically, the DecisionPoint Trend Model. They define the implied bias of the price index based upon moving average relationships, but they do not necessarily call for a specific action. They are information flags that should prompt chart review. Further, they do not call for continuous buying or selling during the life of the signal. For example, a BUY signal will probably (but not necessarily) return the best results if action is taken soon after the signal is generated. Additional opportunities for buying may be found as price zigzags higher, but the trader must look for optimum entry points. Conversely, exit points to preserve gains (or minimize losses) may be evident before the model mechanically closes the signal.
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Price Momentum Oscillator (PMO)