Aug 19, 2013 Outlook: Mood Volatile and Market Down

Today's market outlook is negative.  Both social mood and the news signals indicate a downward day is most likely.

Today’s social mood signal is -5.1 S&P points (entire weekend signal, Sat thru today: -6.6).  Social mood continues to slowly, but surely be breaking down below support.  Markets tend to follow social mood more often than not.

after market update: actual S&P -9.8

 



Today’s news signal is -3.1 S&P points

(entire weekend signal, Sat thru today: +8.3).  News tends to follow the general trend of the market, but on a daily basis, can either lead or lag the movement of the market.  As we’re currently in an inverted news cycle, today’s news may be perceived as slightly positive (yet bad for markets), although the overall weekend news would appear moderately negative (yet good for markets).

Near term outlook:
The social mood patterns correspond with violence and volatility.  Common news events associated with current patterns are violent protests, terrorism, and geopolitical escalation.  Also, events that portray a theme of surprise, action, fires, and explosions.

end of day update-- some top news stories with today's themes:

10000-gallon tank explodes at Pa. plant; 1 dead
Beaver Creek Blaze in Idaho shows no signs of slowing down
Strong winds fan fire along Columbia River
Dick Van Dyke rescued from burning car
Meet Sunny, the new dog adopted by the Obamas (the dog's name, Sunny, is "fiery")

 

Longer term outlook:
The social mood trend is down.  The stock market is over 9% above what social mood will support.  This divergence should be approaching resolution over the next few months.