8/17 Morningline

• Fear index shows bear phase on Person's Proprietary Signal (pps) (VIX).
• Emerging markets turn bullish on the pps (EEM).

Stocks and Rates

	trend	adx	psar	pps	macd	macd trend	sto	sto trend
SPY
QQQQ
VIX
TLT
JNK

The fear index (the VIX) tracks the volatility of the S&P 500. The lore of the markets is when the VIX goes down, the S&P 500 goes up, and vice versa.

The pps bull signal stands in bear phase with the fast stochastic, which gave its signal on Aug. 13.

The preceding, 4-day bull phase on the pps produced a 1% gain in price, so it was not a good signal. Part of the Problem is the VIX, a volatility indicator, is itself not very volatile these days, and that means false signals and whipsaws.

Below, oil and gold, and global indicators.

Oil and Gold

	trend	adx	psar	pps	macd	macd trend	sto	sto trend
USO
GLD

Global

	trend	adx	psar	pps	macd	macd trend	sto	sto trend
EUR/USD
USD/JPY
EEM

EEM rose three trading days straight before showing the pps bull signal. The fast stochastic moved to bull phase on Aug. 13.

The preceding bear phase on the pps lasted five days and produced a 0.2% decline. Not too profitable except for megatraders who can afford to take huge positions. Small private traders? Fuggidaboudit!

Indicator Exchange-Traded Fund Symbols:
EEM - emerging markets
EUR/USD - euro/dollar currency pair
GLD - gold
JNK - high-yield corporate bonds
QQQQ - Nasdaq 100 index
SPY - S&P 500 index
TLT - Treasury long-term bonds
USD/JPY - dollar/yen currency pair
USO - crude oil
VIX - fear index


Abbreviations:

• psar - Parabolic Stop and Reverse
• adx - Average Directional Index
• pps - Person's Proprietary Signal.
• ma20 - 20-day moving average
• macd - Moving Average Convergence-Divergence
• sto - Fast Stochastic

About the glance: The colors indicate the state of each signal.

• trend: Determined by the 5-day moving average, green for up, red for down, yellow for sideways
• adx: orange for above 30-up, blue for 20-down, purple for in the middle. Red is most prone to whipsaws
• psar, pps, macd: green for bull mode, red for bear
• sto: green for overbought, red for oversold, yellow for the neutral zone.