The good news is:
The Dow Jones Industrial average (DJIA) and S&P 500 (SPX) both closed at all time highs last Thursday and the Russell 2000 (R2K) closed at a multi year high.
The NegativesThe first chart covers the last 6 months showing the NASDAQ composite (OTC) in blue and a 10% trend (19 day EMA) of NASDAQ new highs (OTC NH) in green. Dashed vertical lines have been drawn on the 1st trading day of each month. OTC NH did not confirm the new index high a week ago and has remained beneath its high earlier this month. 
The PositivesThe next chart is similar to the one above except it shows the SPX in red and NY NH in green has been calculated with NYSE data. NY NH confirmed the all time SPX high on Thursday implying higher highs ahead.
The next chart covers the past 6 months showing the OTC in blue and a 40% trend (4 day EMA) of NASDAQ new highs divided by new highs + new lows (OTC HL Ratio), in red. Dashed horizontal lines have been drawn at 10% levels for the indicator; the line is solid at the 50%, neutral level (equal numbers of new highs and new lows).OTC HL Ratio rose further into positive territory last week,
The next chart is similar to the one above except it shows the SPX in red and NY HL ratio, in blue, has been calculated with NYSE data.NY HL ratio also moved further into positive territory finishing the week at a very strong 93%. 
The next chart covers the past 6 months showing the OTC in blue and a 10% trend (19 day EMA) of NASDAQ new lows (OTC NL) in brown. OTC NL has been plotted on an inverted Y axis so decreasing numbers of new lows move the indicator upward (up is good). OTC NL continued moving upward; the actual value of the indicator at 102 is troubling.
The next chart is similar to the one above except it shows the SPX in red and NY NL, in blue, has been calculated with NYSE data.NY NL finished the week slightly higher for the week. The actual value of the indicator at 27 is not threatening.
Summation indices are running totals of oscillator values.Short term momentum indicators applied to summation indices make them nearly binary.The first chart covers the past 6 months showing the S&P 500 (SPX) in red and momentum of summation indices of oscillators of advancing and declining issues, new highs and new lows and upside and downside volume on the NYSE. The NY SI Mom’s continued moving upward. The volume component of these has remained strong while the AD and HL components have been jumping aroumd
The next chart is similar to the one above; except it shows the NASDAQ composite (OTC), in blue and the SI’s have been generated from NASDAQ breadth data. NASDAQ SI’s continued their move upward. Recent signals from this chart have been confusing.
SeasonalityNext week includes the first 5 trading days of April during the 4th year of the Presidential Cycle. The tables below show the daily change, on a percentage basis for that period. OTC data covers the period from 1963 to 2023 while SPX data runs from 1928 to 2023. There are summaries for both the 4th year of the Presidential Cycle and all years combined. Average returns for the coming week have been positive by all measures. Report for the first 5 days of April.The number following the year represents its position in the Presidential Cycle.The number following the daily return represents the day of the week;1 = Monday, 2 = Tuesday etc. OTC Presidential Year 4 (PY4) Day1 Day2 Day3 Day4 Day5 Totals 1964-4 -0.05% 3 0.72% 4 0.95% 5 0.37% 1 0.47% 2 2.46% 1968-4 2.39% 1 0.13% 2 0.98% 3 0.20% 4 0.19% 5 3.89% 1972-4 -0.06% 1 0.56% 2 0.95% 3 0.71% 4 0.67% 5 2.83% 1976-4 -0.20% 4 0.21% 5 0.88% 1 0.13% 2 -0.82% 3 0.21% 1980-4 1.63% 2 2.00% 3 0.15% 4 -1.92% 1 0.80% 2 2.67% Avg 0.74% 0.72% 0.78% -0.10% 0.26% 2.41% 1984-4 -0.39% 1 -0.37% 2 -0.15% 3 -1.11% 4 -0.73% 5 -2.75% 1988-4 -0.73% 1 0.41% 2 1.16% 3 0.30% 4 0.78% 5 1.91% 1992-4 -0.28% 3 -1.37% 4 -0.64% 5 1.06% 1 -2.46% 2 -3.69% 1996-4 0.47% 1 0.42% 2 0.41% 3 0.21% 4 -1.12% 1 0.40% 2000-4 -7.63% 1 -1.77% 2 0.49% 3 2.36% 4 4.19% 5 -2.36% Avg -1.71% -0.54% 0.25% 0.56% 0.13% -1.30% 2004-4 1.04% 4 2.09% 5 1.07% 1 -0.92% 2 -0.47% 3 2.81% 2008-4 3.67% 2 -0.06% 3 0.08% 4 0.32% 5 -0.26% 1 3.76% 2012-4 0.91% 1 -0.20% 2 -1.46% 3 0.40% 4 -1.08% 1 -1.43% 2016-4 0.92% 5 -0.46% 1 -0.98% 2 1.59% 3 -1.47% 4 -0.41% 2020-4 -4.41% 3 1.72% 4 -1.53% 5 7.33% 1 -0.33% 2 2.78% Avg 0.43% 0.62% -0.56% 1.74% -0.72% 1.50% OTC summary for PY4 1964 – 2020Averages -0.18% 0.27% 0.16% 0.73% -0.11% 0.87%% Winners 47% 60% 67% 80% 40% 67%MDD 4/4/2000 9.27% — 4/1/2020 4.41% — 4/7/1992 3.67% OTC summary for all years 1963 – 2023Averages -0.05% 0.26% 0.04% 0.24% -0.15% 0.34%% Winners 52% 67% 64% 57% 49% 57%MDD 4/4/2001 10.95% — 4/4/2000 9.27% — 4/5/2002 4.97%
SPX PY4 Day1 Day2 Day3 Day4 Day5 Totals 1928-4 -1.15% 1 0.58% 2 -0.16% 3 1.26% 4 0.21% 1 0.75% 1932-4 -1.78% 5 -1.11% 6 -0.56% 1 -4.67% 2 -2.97% 3 -11.10% 1936-4 1.81% 3 0.99% 4 -0.46% 5 0.79% 6 0.78% 1 3.91% 1940-4 -0.33% 1 0.33% 2 1.55% 3 0.64% 4 -0.32% 5 1.88% 1944-4 0.17% 6 -0.66% 1 0.08% 2 0.08% 3 0.50% 4 0.17% 1948-4 0.27% 4 0.20% 5 0.00% 6 0.20% 1 0.66% 2 1.32% 1952-4 -0.78% 2 -0.25% 3 0.00% 4 -0.41% 5 -0.08% 6 -1.53% 1956-4 0.45% 1 -0.35% 2 0.56% 3 -0.47% 4 0.58% 5 0.77% 1960-4 0.16% 5 0.20% 1 0.59% 2 1.15% 3 0.02% 4 2.12% Avg 0.05% -0.17% 0.25% 0.11% 0.33% 0.57% 1964-4 0.33% 3 0.58% 4 0.30% 5 0.10% 1 -0.35% 2 0.96% 1968-4 2.53% 1 0.17% 2 0.90% 3 0.40% 4 -0.59% 5 3.41% 1972-4 0.26% 1 0.60% 2 0.81% 3 0.39% 4 0.18% 5 2.24% 1976-4 -0.52% 4 0.01% 5 1.23% 1 -0.14% 2 -1.11% 3 -0.53% 1980-4 0.09% 2 0.49% 3 -0.52% 4 -1.92% 1 1.01% 2 -0.85% Avg 0.54% 0.37% 0.55% -0.24% -0.17% 1.05% 1984-4 -0.75% 1 -0.20% 2 -0.08% 3 -1.59% 4 0.28% 5 -2.34% 1988-4 -1.08% 1 0.94% 2 2.70% 3 0.25% 4 1.23% 5 4.04% 1992-4 0.13% 3 -0.92% 4 0.26% 5 1.01% 1 -1.86% 2 -1.38% 1996-4 1.27% 1 0.24% 2 0.09% 3 0.00% 4 -1.77% 1 -0.17% 2000-4 0.49% 1 -0.75% 2 -0.49% 3 0.93% 4 1.01% 5 1.20% Avg 0.01% -0.14% 0.50% 0.12% -0.22% 0.27% 2004-4 0.53% 4 0.85% 5 0.77% 1 -0.21% 2 -0.66% 3 1.27% 2008-4 3.59% 2 -0.19% 3 0.13% 4 0.08% 5 0.16% 1 3.76% 2012-4 0.75% 1 -0.40% 2 -1.02% 3 -0.06% 4 -1.14% 1 -1.87% 2016-4 0.63% 5 -0.32% 1 -1.01% 2 1.05% 3 -1.20% 4 -0.85% 2020-4 -4.41% 3 2.28% 4 -1.51% 5 7.03% 1 -0.16% 2 3.23% Avg 0.22% 0.44% -0.53% 1.58% -0.60% 1.11% SPX summary for PY4 1928 – 2020Averages 0.11% 0.14% 0.17% 0.24% -0.23% 0.43%% Winners 67% 58% 54% 63% 50% 63%MDD 4/6/1932 10.67% — 4/1/2020 4.41% — 4/5/1984 2.60% SPX summary for all years 1928 – 2023Averages 0.12% 0.24% 0.05% 0.22% -0.15% 0.47%% Winners 63% 60% 52% 62% 52% 60%MDD 4/6/1932 10.67% — 4/6/1939 5.33% — 4/4/2001 4.92% AprilSince 1963, over all years, the OTC in April has been up 67% of the time with an average gain of 1.6%. During the 4th year of the Presidential Cycle April has been up 53% time with an average gain of 1.9% (helped significantly by a 15.4% gain in 2020). The best April ever for the OTC was 2020 (+15.4%), the worst 1970 (-18.5%).The average month has 21 trading days. The chart below has been calculated by averaging the daily percentage change of the OTC for each of the 1st 11 trading days and each of the last 10. In months when there were more than 21 trading days some of the days in the middle were not counted. In months when there were less than 21 trading days some of the days in the middle of the month were counted twice. Dashed vertical lines have been drawn after the 1st trading day and at 5 trading day intervals after that. The line is solid on the 11th trading day, the dividing point.In the chart below the blue line shows the average of the OTC in April over all years since 1963 while the green line shows the average during the 4th year of the Presidential Cycle over the same period.
Since 1928 the SPX has been up 65% of the time in April with an average gain of 1.4%. During the 4th year of the Presidential Cycle the SPX has been up 54% of the time with an average of no gain or loss. The best April ever for the SPX was 1933 (+42.2%) the worst 1932 (-20.2%).The chart below is similar to the one above except it shows the daily average performance over all years for the SPX in April in red and the performance during the 4th year of the Presidential Cycle in green.
Since 1979 the R2K has been up 62% of the time in April with an average gain of 1.5%. During the 4th year of the Presidential Cycle the R2K has been up 55% of the time with an average return of 1.4%. The best April ever for the R2K, 2009 (+15.3%), the worst 2022 (-10.0%)The chart below is similar to those above except it shows the daily performance over all years of the R2K in April in magenta and the performance during the 4th year of the Presidential Cycle in green.
Since 1885 the DJIA has been up 61% of the time in April with an average gain of 1.3%. During the 4th year of the Presidential Cycle the DJIA has been up 53% of the time in April with an average loss of -0.2%. The best April for the DJIA 1933 (+40.2%), the worst 1932 (-23.4%)The chart below is similar to those above except it shows the daily performance over all years of the DJIA in April in blue and the performance during the 4th year of the Presidential Cycle in green.
ConclusionThe market had another good week last week the R2K led the way up. The OTC was the only index that did not finish the week at a new highThe strongest sectors last week were Precious Metals and Energy (For the 7th week in a row), while the weakest were Biotech (for the 2nd week in a row) and Telecomm (for the 3rd week).I expect the major averages to be higher on Friday April 5 than they were on Thursday March 28. Last week the OTC was down while the other major indices were up; so I am calling last weeks positive forecast a tie.More By This Author:Technical Market Report – Saturday, March 23Technical Market Report – Saturday, March 15Technical Market Report – Saturday, March 9
