Back To The Future For Nasdaq
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April 24, 2015

4-24-2015 6-05-15 PMubble

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I never thought we’d be back to these dotcom levels in my lifetime, but here we are.

No question about it, many of the shooting stars of the 90’s are no longer in the index.

With the advent of social media much has changed. Some stocks like Yahoo, Cisco, EMC, Qualcomm and others are nowhere near the highs back then.

Now Google and Amazon have ascended with the latter rising a dotcom like 14% just today as earnings losses were brushed off as the focus returned to long term potential. To the latter, we’ve heard that before.

The market is still captive to the “bad news is good” theme as economic data (today’s poor core Durable Goods Orders as an example) continues to demonstrate the disconnect macro has from the market tape. Disciplined tape followers know to follow this and prosper as a result.

For those bewildered investors not in this market, you have a lot of company. The market is now in the hands of the HFTs and hedge funds. Captive money remains in the good times mix but newer and younger investors remain on the sidelines. Veteran investors just don’t know what to make of things. (We continue to recommend investors remain in our Growth & Income Model Portfolio until these trends change.)

The Fed is the responsible party for current circumstances. ZIRP and QE (the latter is still in place given Fed repurchases of maturing debt) remain the cause of a new stock bubble. Primarily this is due to ultra-low interest rate borrowings by corporations making M&A and stock buybacks profitable for senior management particularly. This is the centerpiece of “income inequality” so easily ignored by the financial and mainstream media. Two charts tell of much:

Below are first quarter S&P earnings with and without Apple:

4-24-2015 6-08-23 PM ZH

This information is even more bubblish than that of 2000 which TPTB will deny.

Leading market sectors higher included: Tech (QQQ), Consumer Discretionary (XLY), Homebuilders (ITB), Utilities (XLU), Materials (XLB), Emerging Markets (EEM), EAFE (EFA) Australia (EWA), Germany (EWG), UK (EWU), Indonesia (IDX), Europe (IEV), Hong Kong (EWH), EMU (EZU), Brazil (EWZ), Greece (GREK), Italy (EWI), Mexico (EWW) and Bonds (TLT).

Leading market sectors lower included: Banks (KBE), Regional Banks (KRE), Small Caps (IWM), Mid-Caps (MDY), Energy (XLE), Healthcare (XLU), Biotech (IBB), Industrials (XLI), India (EPI), South Korea (EWY), Gold (GLD), Gold Miners (GDX), and Crude Oil (USO).

The top 20 market movers by percentage change in volume whether rising or falling is available daily.

Volume was as light as a half day holiday trading while breadth and money flow was mostly negative—a serious divergence.

(This why some worry about a “bull trap”.

They always need some shills in the game.)

4-24-2015 6-12-10 PM Diary

Charts of the Day
  • SPY 5 MINUTE

    SPY  5  MINUTE

  • SPY DAILY

    SPY DAILY

  • SPX WEEKLY

    SPX WEEKLY

  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • QQQ DAILY

    QQQ  DAILY

  • NDX WEEKLY

    NDX WEEKLY

  • XLB WEEKLY

    XLB WEEKLY

  • XLE WEEKLY

    XLE WEEKLY

  • XLF WEEKLY

    XLF WEEKLY

  • KBE WEEKLY

    KBE WEEKLY

  • XLI WEEKLY

    XLI WEEKLY

  • XLP WEEKLY

    XLP WEEKLY

  • IBB WEEKLY

    IBB WEEKLY

  • XLV WEEKLY

    XLV WEEKLY

  • XLY WEEKLY

    XLY WEEKLY

  • XLU WEEKLY

    XLU WEEKLY

  • IYT WEEKLY

    IYT WEEKLY

  • IYR WEEKLY

    IYR WEEKLY

  • ITB WEEKLY

    ITB WEEKLY

  • FDN WEEKLY

    FDN WEEKLY

  • TLT WEEKLY

    TLT WEEKLY

  • UUP WEEKLY

    UUP WEEKLY

  • FXE WEEKLY

    FXE WEEKLY

  • FXY WEEKLY

    FXY WEEKLY

  • GLD WEEKLY

    GLD WEEKLY

  • GDX MONTHLY

    GDX  MONTHLY

  • SLV WEEKLY

    SLV WEEKLY

  • DBB WEEKLY

    DBB WEEKLY

  • USO WEEKLY

    USO WEEKLY

  • DBA WEEKLY

    DBA WEEKLY

  • DBC WEEKLY

    DBC WEEKLY

  • EFA WEEKLY

    EFA WEEKLY

  • IEV WEEKLY

    IEV WEEKLY

  • EEM WEEKLY

    EEM WEEKLY

  • EWA WEEKLY

    EWA WEEKLY

  • EWC WEEKLY

    EWC WEEKLY

  • EWG WEEKLY

    EWG WEEKLY

  • EWU WEEKLY

    EWU WEEKLY

  • EWS WEEKLY

    EWS WEEKLY

  • EWZ WEEKLY

    EWZ WEEKLY

  • RSX WEEKLY

    RSX WEEKLY

  • EPI WEEKLY

    EPI WEEKLY

  • FXI WEEKLY

    FXI 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 is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.


 

 

“Things are different this time?” Not a chance. Only the names and faces have changed but a bubble with always be a bubble.

Let’s see what happens.

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...

Headshot David Fry xsmall

Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.  ETF Digest was named one of the most informative ETF website in the 10th Annual Global ETF Awards.

He is the author of "Create Your own ETF Hedge Fund: A Do-It-Yourself Strategy for Private Wealth Management" published by Wiley Finance and "The Best ETFs: U.S. Equities, A Companion Guide to Building Your ETF Portfolio".



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Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com

 

ETF Digest

Market Summary
NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index 10 Year Treasury Note Yield Gold Bugs Index Morgan Stanley High Tech 35 Index Market Chart
Commodity Quote Change Change % NY
Gold1,187.606.200.53 % 09:29
WTI Crude Futr56.94-0.21-0.37 %08:56
Index Quotes Change Change % Local
CRB223.69-0.36-0.16 %09:08
US Dollar97.170.100.10 % 09:23
Index Quotes Change Change % Local
VIX12.29-0.19-1.52 %04/24
MSCI Value Daily MTD YTD
Brazil1829.1492.93 %18.14 % -0.17 %
Russia566.1090.55 %17.87 % 39.81 %
India499.620-2.04 %-4.30 %0.65 %
China83.7840.07 %17.35 % 26.87 %