With stocks essentially on auto-drive since early September and laughing in the face of what was supposed to be a volatile month with some downside, let's switch gears for a day and look at Bitcoin. The crypto currency, or whatever it is, hasn't done a whole lot since March 2024, and at around $67,000 is currently near levels from November 2021. Bitcoin's all-time closing high was $73,118. At this point, it may be a good time to use a trading method called Multi Time Frame Analysis (MTFA), which examines an asset over a variety of time frames, including monthly, weekly, and daily charts. We have found this to be very helpful for both a longer-term investor or a shorter-term trader. On a monthly basis since the start of March, Bitcoin looks extremely calm and appears to be tracing out a multi-month bull flag. Stepping back, it may be tracing out a multi-year bullish cup-with-handle formation. Using monthly candles, Bitcoin has been supported by its 10-month exponential during the flag. Price is now right at the top of the downward-sloping flag, and a strong breakout could open the door for several measured moves, with an initial rally likely halted at $100,000. On a weekly basis, Bitcoin looks much-more volatile since March and it may be tracing out an extended flat, which is a continuation pattern. Weekly momentum recently turned higher, as has the weekly vortex indicator. Like gold, Bitcoin has ignored the dollar rally since late September. We previously have noted that big Bitcoin rallies have been concurrent with a dollar decline. (Mark Arbeter, CMT)

As we enter the seasonally strong fourth quarter (although October can be rough in a presidential election year), the major and minor indices are all higher by 10% to 26%. The biggest winner (and an index that gets little press) is the Invesco S&P 500 Top 50 ETF (XLG, up 25%). It's followed by the S&P 100 (OEX), with a 23% gain. The Nasdaq (IXIC) has risen 21%, the S&P 500 (SPX) and the iShares Russell 3000 (IWV) are both up 20%, the Nasdaq 100 (QQQ) is up 19%, the NYSE Composite (NYA) is up 16%, the S&P Equal Weight ETF (RSP) and S&P MidCap 400 (MDY) have both gained 13%, the Dow Jones Industrial is up 12%, and (bringing up the rear) the Russell 2000 (IWM) is up 11%. Sector performance is robust, led by the "new growth" Utilities (XLU), which have soared 30%. That is followed by Communication Services (XLC +25%), Financial (XLF +21%), Industrials (XLI +19%), and Information Technology (XLK) and Consumer Staples (XLP), both 18% higher. Elsewhere, Consumer Discretionary (XLY), Real Estate (XLRE), Healthcare (XLV) and Materials (XLB) are all up 13% to 15%. Energy (XLE) is at the bottom, up a mere 7%. In other markets, some of which just got a shot in the arm from China, silver futures have popped 32%, gold has risen 29%, copper is up 18%, natural gas has tacked on 15%, TLT is up 2%, the U.S. Dollar Index is down 1%, and WTI is off 5%. The third quarter looks like another winner (SPX above 5,460) and that will make it seven out of eight (87.5%) going back to Q4 2022. That type of consistency is quite common. On a monthly basis, the SPX is up 18 out of 24 months, or 75% of the time. On a weekly basis since late-October 2023, the index is higher in 34 of 48 weeks (71%). (Mark Arbeter, CMT)

The curse of September is alive and well. Once again, the largest drag on the market last week was the Information Technology (XLK) sector, which dropped 7.4% for the worst weekly decline since the pandemic. The sector was again dragged down by the once-beloved semiconductor stocks, as the major semi indices and ETFs were pulverized, dropping by 12%. Both the iShares Semiconductor ETF (SOXX) and the VanEck Vectors Semi ETF (SMH) fell below their 200-day averages for the second time since this correction started. Since July 17, both ETFs have dropped at least 6% on three separate days. All three of those days featured heavy volume, a sign of distribution. We started to see distribution back in the middle to latter part of July. Most of the major semi stocks have lost their 50-day average for the second time since late July and a handful are breaking below their more-important 200-day averages and are closing in or breaking their initial pullback lows from early August. The QQQ cratered 5.8% last week and retraced 61.8% of its rally from early August. We had a five-day/13-day exponential moving average (EMA) crossover sell signal, reversing the buy signal from August 15. The rising 200-day average should be near 443 when extending out a week. Once again, the selling was accompanied by an increase in volume. The S&P 500 lost 4.3% as the index lost its 50-day average but did hold its more-important 21-week EMA. The index has retraced almost 50% of its recent rally (which comes in at 5,386), while a 61.8% give-back targets 5,322. The index also had a bearish five/13 EMA crossover. (Mark Arbeter, CMT)

The Nasdaq is down more than 1%. Other major indices are flat. Earnings reports are driving action for individual stocks. Many retailers are still reporting with mixed stories on last quarter. In case you haven't heard, AI behemoth Nvidia reports after-the-bell.