Maintain that High or Self-Destruct!: 23 Oct. '13

after market update: actual S&P -8.3 (-0.47%); As suspected, the turning process was still in progress today causing the mood and market opposition to continue.  However, there's a good chance that by tomorrow social mood and the markets will be back in sync.

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Overview: Collective mood portrays either a sense of irrational exuberance or manic destructiveness (or both).  Today's potentially large market moves could bring resolution to the mood/market divergence that has been observed over the past week or so. 

Today's Market Outlook is Up (+1.0% to +1.2%)   Both social mood and news signals are strongly positive today, but the trend change is still in process.  This may continue to result in inverted model results where mood is opposing the markets.  If so, today could end up being a strong down move.  However, it turns out, a large directional move today should resolve the mood/market divergence that has been showing up over the past week or so.

 

Near term mood outlook: The social mood pattern corresponds with either a desperate pushing or utter exhaustion. The combined pattern of news and social mood, at times, accompanies global themes of violence, instability, and geopolitical escalation.

 

Near term market outlook: Social mood is at resistance; markets are at a turning point.  If mood and markets do not turn down immediately, a strong positive surge into a new range could be at hand.

 

Longer term outlook: The overall social mood trend is down.  When the current bounce is over, markets should be turning down and joining mood in a period of decline. 

 

Today’s social mood signal is +19.3 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is +17.2 S&P points.  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Looking Shaky: Outlook 22 Oct. '13

after market update: actual S&P +9.99 (+0.57%); A strange mix showed up today as this major turning process continued to play out.  Even with the markets ending up over 1/2%, the VIX (i.e. the fear index) ended up even more than that.  The markets are currently running inverted to the social mood signal.  That is expected to right itself when this turning process is complete.

An interesting headline on the VIX today: VIX Trader Pays $6.7 Million Betting Fear Gauge May Double

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Overview: Social mood shows a combination of aggression and increasing uncertainty.  Today's news is likely to be considered somewhat negative.  Markets remain at a major turning point. 

Today's Market Outlook is Down (-0.2% to -0.3%).  Both social mood and news signals are negative today, but the trend change is still in process.  This may create choppy or confused markets.

 

Near term mood outlook: The social mood pattern corresponds with aggression with increasing uncertainty combined with "bad news."  The combined pattern, at times, accompanies global themes of violence, instability, and geopolitical escalation.

 

Near term market outlook: Social mood is at resistance; markets are at a turning point.  If mood and markets do not turn down immediately, a strong positive surge into a new range could be at hand.

 

Longer term outlook: The overall social mood trend is down.  When the current bounce is over, markets should be turning down and joining mood in a period of decline. 

 

Today’s social mood signal is -4.6 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is -2.8 S&P points.  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Major Turning in Progress, Bumpy Road Ahead: Outlook 21 Oct. '13

after market update: actual S&P +0.16 (+0.01%); Market does indeed appear to be undergoing a turning point, as the entire day showed uncertain action near the unchanged line.  A directional move did not occur as this turning process is still in progress.

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Overview: Social mood shows an almost desperate, last gasp, surge of aggression or optimism.  Today's news is likely to be considered somewhat negative.  Markets are at a major turning point.  Will they turn down from here, or begin a new range upward?

Today's Market Outlook is Uncertain, Directional (-0.1% to +1.2%).  A strong directional move is expected today.  Whether it will be up or down is unclear due to a trend change in progress.  Social mood is desperately trying to push ahead, the news (or global reality) is dragging it down.

 

Near term mood outlook: The social mood pattern corresponds with a desperate striving toward optimism in the face of bad news.  The combined pattern, at times, accompanies global themes of violence, instability, and geopolitical escalation.

 

Near term market outlook: Social mood is at resistance; markets are at a turning point.  If mood and markets do not turn down immediately, a strong positive surge into a new range could be at hand.

 

Longer term outlook: The overall social mood trend is down.  When the current bounce is over, markets should be turning down and joining mood in a period of decline. 

 

Today’s social mood signal is +12.1 S&P points (+20.7 S&P points for the entire weekend signal, Saturday through Monday).  Markets tend to follow social mood more often than not. 

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Today’s news signal is -2.6 S&P points (-1.9 S&P points for the entire weekend signal, Saturday through Monday).  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Major Socioeconomic Turning Point Days Away: Outlook 18 Oct. '13

after market update: actual S&P +11.2 (+0.65%); Today wasn't the day.  We'll look for it next week.

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Overview:  An interesting divergence has been showing up over the past few days.  Wall Street has been hoping and then celebrating the debt deal, while overall collective mood has been signaling a major breakdown is fast approaching.  Will it begin today?  Or, will today once again see this divergence strengthen and tension pulled even tighter towards an eventual snap back?

Today's Market Outlook is Turning Down (-0.2% to -1.3%).  At the time of this posting, both the social mood signal and the signal from the news are negative.  If the market breaks down, the overbought condition of the market (relative to collective mood) may result in a sharper drop than indicated by today's collective mood signals alone.  The stronger negative number in the outlook above, -1.3%, accounts for this.
 

Near term mood outlook: The social mood pattern corresponds with an increase in protests, complaints, and self-sacrifice for an ideology.  Common themes associated with the mood pattern found in the news is anything under the basic heading of general "bad news."  The combined pattern, at times, accompanies global themes of violence, instability, and terrorist activity; yet also, new diplomatic possibilities.

 

Near term market outlook: Social mood is hovering near support (see chart below).  A serious breakdown in the markets may begin at any time.

 

Longer term outlook: The social mood trend is down.  Markets should be turning down and joining mood in a period of decline. 

 

Today’s social mood signal is -5.5 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is -4.1 S&P points.  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Back to Normal? Outlook 17 Oct. '13

after market update: actual S&P +11.4 (+0.66%); Markets continued to climb, in spite of slowly deteriorating social mood.  Art Cashin, a regular on CNBC likened the persistent market climb to the tech bubble of 1999-2001.  With social mood at support, a sharp break down below that may be the signal that the markets will have no choice but to follow.  The next few days are critical to long term direction.

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Overview:  The U.S. government shutdown is over and there was no default, at least there shouldn't be one this year.  The social mood shows a slight relaxing of the aggressiveness that has been pervasive.  The mood depicted by themes in the news reflects waning uncertainty, mania and the perception of "bad news"  The stock market may try to continue its recent uptrend, but the collective mood is a heavy weight pulling it down.  It's unclear how far it will continue going beyond where the mood will support.  Very soon, the rubber band will snap.

Today's Market Outlook is Confused, and Down (-0.2% to -0.3%).  At the time of this posting, both the social mood signal and the signal from the news are negative.  If the market turns down, the overbought condition of the market (relative to collective mood) may result in a sharper drop than indicated by the models.
 

Near term mood outlook: The social mood pattern corresponds with a slight relaxation of aggressiveness.  Common themes associated with the mood pattern found in the news are the unexpected, protests, terrorism, and general "bad news."  The combined pattern, at times, accompanies global themes of violence, instability, and terrorist activity; yet also, new diplomatic possibilities.

 

Near term market outlook: Social mood is hovering near support (see chart below).  A serious breakdown in the markets may begin at any time.

 

Longer term outlook: The social mood trend is down.  Markets should be turning down and joining mood in a period of decline. 

 

Today’s social mood signal is -4.4 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is -3.4 S&P points.  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Scrambling, Arguing, and Blaming: Outlook 16 Oct. '13

after market update: actual S&P +23.4 (+1.4%); Markets soared as time came for the debt deal to be made and the crisis resolved.  That's when the blame game started.  Even with the deal, or perhaps because of it, Republicans are in trouble.  The high divergence between the timid collective mood signals and the action in the stock market will bear close watching over the next few days.  The relief seen in Wall Street does not appear to translate to the general public or world at large.  Here are some of the headlines coming in on the blame game theme, and frustration at the further arguing ahead:

The right's angry response to the House GOP's collapse

Boehner caves

Relief to be short in emerging debt deal

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Overview:  A U.S. government shutdown is in day 16, and participants should continue to be aggressively and desperately pushing their side's agendas.  The mood depicted by themes in the news is uncertainty, confusion, mania and the perception of "bad news"  Markets may be confused, jostled by every rumor and hope, but the overall outlook is down.

Today's Market Outlook is Confused, and Down (-0.1% to -0.4%).  At the time of this posting, both the social mood signal and the signal from the news are negative.  If the market turns down, the overbought condition of the market (relative to collective mood) may result in a sharper drop than indicated by the models.
 

Near term mood outlook: The social mood pattern corresponds with a desperate forward pushing.  Common themes associated with the mood pattern found in the news are uncertainty, the unexpected, chaos, protests, and terrorism.  The combined pattern, at times, accompanies global themes of violence, instability, and terrorist activity.

 

Near term market outlook: Social mood is hovering near support (see chart below).  A serious breakdown in the markets may begin at any time.

 

Longer term outlook: The social mood trend is down.  The overall market trend should be down. 

 

Today’s social mood signal is -5.1 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is -1.9 S&P points.  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.    

 

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Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change. 

Surprising News: Outlook 15 Oct. '13

after market update: actual S&P -12.1 (-0.7%); Not sure the news was that surprising so far today, although it has seemed to rattle the hopeful camp some.  This morning people were somewhat optimistic a deal was near in the U.S. shutdown.  As of market close, each group seemed to still be boldly marching in their own direction with little chance of resolution this evening.  Are there more or larger surprises ahead?  The market call for today of uncertain/mixed played out well.  The markets today opened sharply down, climbed back above zero about two hours in, went sideways for a few hours, then ended back at the lows.

evening update:  Here's a surprise:  House vote delayed, chaos continues.  "Reid said he was 'blindsided by the news from the House.'"

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Overview:  A U.S. government shutdown is in day 15, and participants should be aggressively and desperately pushing their side's agendas while trying not to appear weak or vulnerable.  Social mood today is supportive of a possible breakthrough in group leadership or doing the right thing for the group (a shutdown deal?)  The mood depicted by themes in the news is uncertainty, confusion, mania and the perception of "bad news."  If the stock market starts in one direction, look for possible breaking news to change the direction.

Today's Market Outlook is Mixed / Uncertain (-0.7% to +0.7%).  At the time of this posting, the social mood signal is moderately positive, yet the signal from the news is moderately negative.  If the market turns down, the overbought condition of the market (relative to collective mood) may result in a sharper drop than indicated by the models.
 

Near term mood outlook: The social mood pattern corresponds with a desperate forward pushing, and trying not to appear weak or vulnerable.  Social mood today is supportive of a possible breakthrough in group leadership or doing the right thing for the group.  Could there be a deal in the debt/shutdown crisis?  Common themes associated with the mood pattern found in the news are uncertainty, the unexpected, chaos, protests, and terrorism.  The combined pattern, at times, accompanies global themes of violence, instability, and terrorist activity.

 

Near term market outlook: Social mood is hovering near support (see chart below).  A serious breakdown in the markets may begin at any time.

 

Longer term outlook: The social mood trend is down.  The overall market trend should be down. 

 

Today’s social mood signal is +11.4 S&P points.  Markets tend to follow social mood more often than not. 

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Today’s news signal is -11.0 S&P points.  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.    

 

(click to enlarge)

 

 

Note: data for U.S. social mood are scores in eight MoodCompass categories of Google Hot Trends, data for news are scores of top Google U.S. news stories.  Scores are converted to 4 inputs to the Market Mood Model.  The output is a conversion of mood data to estimated S&P point change.