BLOWOUT ISM ADDS AIR TO THE STOCK MARKET BUBBLE

To gain an edge, this is what you need to know now.

Prudent investors and money managers who want to gain an edge in the stock market should pay attention to economic indicators.  The problem most investors face is that there are hundreds of economic indicators.  At The Arora Report, our research has narrowed down economic indicators to a manageable number that make the most difference for investors.

ISM Index is one such indicator that investors should pay attention to.

Blowout ISM

Please click here for a chart of  S&P 500 ETF  () which represents the benchmark for the stock market index ().

Note the following:

  • The chart shows when the ISM Non-Manufacturing Index was released.
  • This index is based on a survey of purchasing and supply chain executives of 400 service companies.
  • The index came at 63.7% vs. 58.5% consensus.  This is a very strong number.
  • The index is at the highest level since 1997.  This illustrates how strong purchasing managers expect the economy to be. 
  • Normally on such strong numbers as this ISM and the employment report from Friday, there would be talk of the Fed raising the interest rate.   In the past, such talk would have restrained the stock market rally.  But in this market, the Fed and Biden have concluded that there is a free lunch by money printing and borrowing at full speed.
  • The VUD indicator is the most sensitive measure of net supply demand in real-time. The orange represents net supply and the green represents net demand.
  • The chart shows the VUD indicator was solid green but in the afternoon has flipped to orange. The reason for a flip to orange is that many investors are beginning to wonder how long can the Fed and Biden carry on these policies to pump more air into the stock market bubble.

Money Flows

The momo crowd money flows since the Morning Capsule are 🔒 (To see the locked content, please take a 30 day free trial).

Smart money flows since the Morning Capsule are🔒 in select stocks but 🔒 in aggressive momo stocks.

Short squeeze money flows are🔒.

A Special Note To New Subscribers

Note the smart money behavior.  Smart money tends to sell into strength on strong up days.

New subscribers should consider adopting smart money’s  way of investing and trading.

Sentiment

Sentiment is 🔒.

Sentiment is a contrary indicator at extremes.  In plain English, this means that when sentiment becomes extremely positive it is time to sell and when sentiment becomes extremely negative it is time to buy.

Gold

The momo crowd money flows in gold are 🔒 since the Morning Capsule.

Smart money flows are 🔒 in gold  since the Morning Capsule.

Oil

The momo crowd money flows in oil are🔒 since the Morning Capsule.

Smart money flows in oil are 🔒 since the Morning Capsule.

Buy Zones And Buy Now Ratings

🔒

Nibbling

🔒

Close

There appear to be  buy on close orders.

There is merit to watching the pattern of market on close orders as they represent the day’s dominant net cumulative activity  by many professionals and funds.

This post was published yesterday in The Arora Report  paid services.  Since then the Morning Capsule has an update in the paid services.

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