Market Analysis: Negative Divergences, Etc.

As highlighted by Sentiment Trader in a report out tonight, the Dow Jones Transports index is negatively diverging from the DJIA. While not necessarily a concern in and of itself, this divergence is in addition to negatively diverging S&P 500 200dma and 50dma breadth, as well as a material slowdown in US equity market “demand”. 

Also – Sentiment Trader points out that household cash levels are quite emphatically not nearly as high as the Barry Ritholtz/Josh Brown/”Common Sense” straw man investor that has been in cash since the generational low in March 2009. In fact, they are near record lows. Whoops. 

Certain “Finance Twitter” cognoscenti have opined – based on anecdotal evidence – that market participants are too negative, and thus the market is poised to climb. Perhaps. But I would welcome that – hopefully tomorrow on the back of AAPL’s earnings announcement – so that I could put the remainder of my market in place. 



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