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Two of the mega cap Nasdaq 100 stocks reported last night and one really missed (Amazon) and one was just OK (Alphabet).  Amazon has been the largest attribute in the Nasdaq 100 year to date as well from the last good low back in February 2016.  Since the lows in 2009, the Nasdaq 100 has been led by five stocks Apple, Amazon, Microsoft, Facebook and Alphabet attributing to 50% of the total gain.  The one big difference this year is how much Amazon has over attributed vs historical ranges.  Back in October 2007, Apple attributed 23% of the YTD gain and then I was quite concerned (ranting) about it within my hedge fund.  Amazon reached 30% of the YTD attribution this year.  Short interest has been very low, it's a crowded long so when then missed on several metrics (mentioned on yesterday's note) last night the out sized drop was no surprise.  A month ago Morgan Stanley put out a great note warning of a top in data center spending and that told me the growth in tech (cloud) was topping.  The custom index I created with all of their names has now given back the entire YTD gains in a month!  The fact is that there is a lot of cloud capacity out there now with Amazon and Microsoft as the two clear leaders (MSFT missed slightly on Azure btw too).   Semi names like AMD and Nvdia, disk drives like Western Digital and Seagate are all getting crushed due to this top in data center spending.   I believe Amazon trade sideways to down for years to come unless they move into a new business space that produces earnings.

I've had a lot of people ask "Where is the bottom?" or what levels would I buy.  As you know,  I started buying a few days ago covering quite a bit, raising cash and  flattening exposure believing a lower high bounce would develop soon.  The steepness of the drop and the continued downside DeMark Countdowns have not given me confidence to send an all clear.   Furthermore, this first down move is wave one of five on the downside.  Can you exploit some upside moves?  Yes, but let's wait to see Apple earnings next week.  My view is that people have been too quick to want to buy as seen yesterday and by the bounce intraday today.  This has been too orderly without panic and absent of capitulation.  

Have a great weekend and thank you for all your support.  And as a reminder, trials will end soon and if you want to soothe my pain of being an LA Dodger fan who has to go to Boston this weekend, you can sign up as a client to Hedge Fund Telemetry today

• US Markets - Sentiment remains low, some oversold conditions are present. Attribution remains narrow.   Everything has been in first down wave of five so a lower high bounce is expected
  
• Hedge Fund Telemetry Trade Ideas - TSLA stopped out at 325 +11.66% gain
  
• US Total Market and World Ex US ETF's Update
  
• Amazon - When Good Stocks Go Bad
  
• Credit Spreads Update
  
• US Total Market Cap Index - Downside DeMark exhaustion signal
  
• PPO Monitor - Percentage Price Oscillator Force Ranked Sector Rotation - Good look at intraday reversal
  
• Bloomberg Technical Pattern Recognition Screen
  
• Currency Update - Still expect higher USD
  
• European Market Update - New lows but bounced off lows.  UK is near downside exhaustion
  
• Asian Market Update - Still looks risky in Japan, India, and especially Korea
  
• Crude Update - Holding support for now
  
• Gold Update -  Slightly up today
  
• Bond Update  - New lows in yields today as expected
  
• DeMark Screens - Daily, Weekly, Monthly upside/downside exhaustion signals within the S&P 500 and Euro Stoxx 600
  
• Sold today's QQQ expiration puts added yesterday for a nice gain and holding the others through next week at least.

Here's a link to the Hedge Fund Telemetry market sentiment page with 40 charts of sentiment including equities, bonds, currencies, and commodities updated each day.  When the new website launches we will be adding new charts and historical sentiment data for Euro Stoxx 50, UK FTSE 100, German DAX, French Cac 40.  We will be adding Japanese Bonds, German Bunds, and a few more.  
SPX bullish sentiment is at 13%

SPX daily very steep and nearing downside Trend Factor target that also retraced the same amount in February

SPX YTD attribution shows the top 3 stocks AAPL, AMZN, MSFT still have done the majority of the work.  

SPX 60 minute tactical time frame reached the downside wave 5 target

Nasdaq bullish sentiment is at 13%

NDX Index has been much worse than SPX

The NDX also shows the same three but an even more out sized attribution concentration

NDX 60 minute tactical time frame bounced intraday after I grabbed this chart

Nasdaq Summation Index has been going down for weeks while most people had no clue but we did!!  Now it's oversold so lets see if next week it can bounce

Nasdaq % of stocks above the 50, 150 and 200 day is pretty oversold.  I could see a 2015/2016 bounce then drop back lower

Dow Jones Industrial Average

IWM Russell 2000 has a Combo 13 today and could bounce

Trade Ideas Sheet - Long and short US equity ideas including ETF's.  We will be overhauling the Trade Ideas Sheets for long only, short only, ETF's when the new website rolls out soon.  There will also be a clearer email distribution with changes.  
Trade Ideas Changes:  STOPPED ON TSLA AT 325 +11.66% GAIN
Stops on everything.  GDX 17.35 , FEYE 16.00, NVDA 235,  QQQ 179, XLK 75, SPY 285, XLY 113,  XRT 50, IWM 163, NSC 173, DIA 260, XLI 77 IBB 116,   AMZN 1860 DXJ 56 , GLD 111, IEF 98  TLT 112 , BA  370, IBM 140, NFLX 345 (RECENTLY ADJUSTED STOPS)   GOOGL 1000,  ITB 28

US Total Market still has a downside DeMark Countdown

World Ex US has a Combo 13 and red Sequential getting closer

Amazon still has a downside DeMark Countdown in progress and is on wave 3 of 5

When I built this chart in September I expected this to drop but perhaps not to give back the ENTIRE YTD gains!

Still knocking on recent wides

Nearly 11% has been trimmed off the US total market cap from the highs when I showed the upside DeMark Countdowns.  There is now one on the bottom so perhaps a bounce is near

The PPO Monitor is a proprietary monitor developed to force rank Indexes, Sectors, and Stocks.  It ranks top down by strongest to weakest by percentage above/below the 50 day moving average.  Shorter term signals can be seen when the 10 and 20 day moving averages turn up (green) or down (red) which often are followed by the 50 day moving average.  This is useful to watch for historically overbought/oversold percentage above/below the 50 day moving average.  It is non correlated with the DeMark Indicators however we have found upside/downside exhaustion signals often occur when something rises to the top or drifts to the bottom of the monitor - increasing the timing aspect. We share this monitor with clients with Bloomberg Terminals.  An added feature is that each market/ETF can be expanded with each component force ranked in the same way.  A couple other features include price deviation from intraday VWAP (useful for intraday reversals) and new 20 day highs/lows on right side.  Please inquire if you would like to be permissioned to use the PPO Monitor.  

Today's highlights: This was taken a little early in the day but it shows how red the indexes were while they were over today's VWAP illustrating how a bounce was happening early on

S&P 500 Members/Absolute Price Performance and Relative Price Performance vs S&P 500 and Sector ETF's.  ETF's vs Index Sectors.  Pair Trades.  Long side  is first symbol, short side is second symbol.  If you would like a PDF from Bloomberg with full details of how this is formulated, please email.  We will be doing a webinar in the coming weeks specifically on this system.

US Dollar bullish sentiment is at  90% and extreme

US Dollar Index has been back and forth in the green today.  It still needs to close oover 96.73 to revert back to wave 5

Euro bullish sentiment is at 11%.  As you see it can and might stay in the green zone for months

Euro Spot still looks lower

Yuan nearing the 7 level.   I expect it to break below soon

Euro Stoxx 50 hit a new low but bounced off low

European Banks getting closer to downside DeMark exhaustion signal

UK FTSE should have a downside exhaustion on Monday

Hong Kong another new low

Nikkei really had a good reaction at the upside exhaustion signals.  

DXJ Japan ETF is down 12% on the Trade Ideas Sheet

India is getting closer to a level to bounce

Korea really looks dangerous still with a downside Countdown in progress

Crude bullish sentiment is at 63%  and WTI Crude Futures continues to hold support

Gold bullish sentiment is at 31%

Gold continues higher

Gold Miners GDX ETF bouncing after yesterday's slam

Bond bullish sentiment is at 53% and could continue higher.  TLT still slowly working higher

IEF ETF also slowly working higher.  The upside Trend Factor target is surprisingly high

US 10 Year Yield made a 1 month low today

US 30 Year Yield has support at 3.30%

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