The good news is new lows continue at minimal levels. But the negatives include narrow leadership; there have been very few new highs considering the indices are near their all time highs.

The first chart covers the past six 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 of the 1st trading day of each month.

The recent index high was unconfirmed both long and short term by OTC NH.

The next chart is similar to the one above except it covers the past 5 years and dashed vertical lines have been drawn on the first trading day of each year.  

The current OTC NH non confirmation is extreme.

The next chart is similar to the first one except it shows the S&P 500 (SPX) in red and NY NH, in green has been calculated with NYSE data.

Similar to the first chart but worse.

The next chart is similar to the 2nd one except it shows the SPX in red and NY NH has been calculated with NYSE data.

Also similar, but worse.

The Positives

The number of new lows has been insignificant.

The next chart covers the past 6 months showing the SPX in red and a 40% trend (4 day EMA) of NYSE new highs divided by new highs + new lows (NY HL Ratio), in blue.Dashed horizontal lines have been drawn at 10% levels for the indicator; the line is solid at the 50%, neutral, level.

NY HL Ratio remained above 90%, very strong. 

The next chart is similar to the one above except it shows the OTC in blue and OTC HL Ratio, in red has been calculated with NASDAQ data.

OTC HL Ratio declined a little to a strong 78%.

Seasonality

Next week includes the last five trading days of July during the fourth 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 2019 while SPX data runs from 1928 to 2019.There are summaries for both the fourth year of the Presidential Cycle and all years combined. 

Returns for next week have been mostly positive.

Report for the last 5 days of July

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)

               Day5 Day4 Day3 Day2 Day1 Totals

 1964-4-0.02% 1-0.34% 2 0.02% 3 0.05% 4 0.10% 5-0.19%

 1968-4-1.00% 2-0.84% 4-1.41% 5 0.21% 1-1.28% 2-4.31%

 1972-4-0.23% 2 0.14% 3-0.23% 4-0.16% 5-0.31% 1-0.79%

 1976-4-0.13% 1-0.20% 2-0.32% 3-0.18% 4 0.48% 5-0.34%

 1980-4-0.17% 5 0.23% 1 0.61% 2 0.74% 3-0.30% 4 1.11%

 1984-4-0.19% 3 0.78% 4 0.99% 5-0.15% 1 0.33% 2 1.75%

 1988-4-0.06% 1-0.34% 2-0.64% 3 0.20% 4 0.85% 5 0.00%

 1992-4-0.16% 1 1.22% 2 1.03% 3 0.23% 4 0.35% 5 2.67%

 1996-4 1.92% 4 1.60% 5-1.20% 1 0.52% 2 0.80% 3 3.64%

 Avg0.27% 0.70% 0.16% 0.31% 0.40% 1.84%

 2000-4 1.21% 2-1.04% 3-3.65% 4-4.66% 5 2.84% 1-5.31%

 2004-4-0.54% 1 1.64% 2-0.58% 3 1.23% 4 0.33% 5 2.07%

 2008-4 1.33% 5-2.00% 1 2.45% 2 0.44% 3-0.18% 4 2.03%

 2012-4-0.31% 3 1.37% 4 2.24% 5-0.41% 1-0.21% 2 2.67%

 2016-4-0.05% 1 0.24% 2 0.58% 3 0.30% 4 0.14% 5 1.21%

 Avg0.33% 0.04% 0.21%-0.62% 0.58% 0.54%

OTC summary for PY4 1964 - 2016

Averages 0.11% 0.18%-0.01%-0.12% 0.28% 0.44%

% Winners 21% 57% 50% 64% 64% 64%

MDD7/28/20009.10% --7/30/19684.25% --7/28/20082.00%

OTC summary for all years 1963 - 2019

Averages 0.01% 0.04%-0.13%-0.02%-0.06%-0.16%

% Winners 53% 49% 44% 60% 49% 56%

MDD 7/28/20009.10% --7/31/19746.22% --7/31/19694.97%

SPX PY4

               Day5 Day4 Day3 Day2 Day1 Totals

 1928-4 0.21% 4 0.94% 5 0.26% 6 0.00% 1-0.21% 2 1.20%

 1932-4-1.46% 2 5.00% 3 3.17% 4 3.08% 5 1.16% 610.95%

 1936-4 1.00% 1-6.38% 2 5.56% 3 0.38% 4-1.06% 5-0.51%

 1940-4 0.50% 5 0.40% 6 0.70% 1 2.48% 2-0.39% 3 3.70%

 1944-4-0.23% 3 0.00% 4-0.55% 5 0.00% 6 0.08% 1-0.70%

 1948-4-0.92% 1 1.05% 2-0.68% 3-0.80% 4-1.25% 5-2.59%

 1952-4-0.32% 5 0.16% 1 0.24% 2 0.44% 3 0.12% 4 0.63%

 1956-4 0.22% 3 0.08% 4-0.81% 5-0.16% 1 0.80% 2 0.13%

 Avg -0.15% 0.34%-0.22% 0.39%-0.13% 0.23%

 1960-4-0.99% 1 0.61% 2-0.62% 3 0.74% 4 1.72% 5 1.46%

 1964-4-0.46% 1-0.28% 2 0.08% 3 0.21% 4 0.11% 5-0.33%

 1968-4-0.12% 2-1.28% 4 0.41% 5-0.70% 1 0.09% 2-1.60%

 1972-4-0.30% 2-0.07% 3-0.23% 4 0.09% 5 0.01% 1-0.49%

 1976-4 0.01% 1-0.57% 2-0.42% 3-0.12% 4 0.50% 5-0.59%

 Avg -0.37%-0.32%-0.16% 0.04% 0.49%-0.31%

 1980-4-0.83% 5 0.54% 1 0.80% 2-0.14% 3-0.46% 4-0.09%

 1984-4 0.68% 3 0.84% 4 0.74% 5-0.66% 1 0.31% 2 1.91%

 1988-4 0.45% 1 0.19% 2-1.01% 3 1.34% 4 2.26% 5 3.22%

 1992-4-0.01% 1 1.45% 2 1.13% 3 0.40% 4 0.07% 5 3.04%

 1996-4 0.72% 4 0.75% 5-0.79% 1 0.69% 2 0.74% 3 2.11%

 Avg0.20% 0.75% 0.17% 0.33% 0.58% 2.04%

 2000-4 0.69% 2-1.50% 3-0.19% 4-2.05% 5 0.77% 1-2.27%

 2004-4-0.20% 1 0.99% 2 0.05% 3 0.46% 4 0.12% 5 1.42%

 2008-4 0.42% 5-1.86% 1 2.34% 2 1.67% 3-1.31% 4 1.25%

 2012-4-0.03% 3 1.65% 4 1.91% 5-0.05% 1-0.43% 2 3.05%

 2016-4-0.30% 1 0.03% 2-0.12% 3 0.16% 4 0.16% 5-0.06%

 Avg0.12%-0.14% 0.80% 0.04%-0.14% 0.68%

SPX summary for PY4 1928 - 2016

Averages -0.05% 0.12% 0.52% 0.32% 0.17% 1.08%

% Winners 43% 65% 57% 57% 70% 57%

MDD7/28/19366.38% --7/28/20003.70% --7/30/19482.70%

SPX summary for all years 1928 - 2019

Averages -0.04% 0.04% 0.07% 0.13% 0.04% 0.24%

% Winners 54% 58% 50% 61% 59% 55%

MDD 7/26/19347.83% --7/31/19336.84% --7/31/19746.68%

Conclusion

No new lows, free money and an attentive Plunge Protection Team (PPT) AKA Presidents Working Group on Financial Markets doing everything possible (legal or not) to keep prices of everything up. 

The strongest sectors last week were precious metals and banks the weakest were health care and tech. 

I expect the major averages to be higher on Friday July 31 than they were on Friday July 24.In the PPT I trust.

Last week last weeks positive forecast was a miss.