A Week Of Warnings As Transports Break Out

This is an abridged version of our Daily Report.

A week of warnings

Every day last week triggered a Hindenburg Omen or Titanic Syndrome technical warning signal.

While they are much-maligned and not immune to failures, similar clusters of these warning signs preceded consistent weakness across stocks and sectors and were good for volatility.

A not so leading indicator

The Dow Transports broke out to a new high, exceeding its highs from August and January. At the same time, the Dow Industrials are lagging, more than 2.5% and 150 days from its own high. This has not been a positive leading indicator for the Industrials, with more large declines than rallies in the months ahead.

Pinned

After a tough day on Monday, the Invesco India fund, PIN, has the lowest Optimism Index out of the country ETFs we follow according to the Geo-Map.

Still speculative

Two weeks ago, we saw that there was a big jump in speculative options activity. That continued last week, as the Options Speculation Index declined only slightly, from 1.33 to 1.31.