David Chojnacki S1F Market Technician
After a move to the downside in the morning, the Market slowly recovered to finish mixed. The S&P and DJIA were down slightly, while the Nasdaq100 was up 0.8%. Breadth was negative, 1.5 to 1, on very weak volume, once again. The bright spot in yesterday’s action was the Nasdaq100 closing above the recent trading range, which was at 2308. RSI’s for all three indices are in the upper 50’s to 60’s and ROC(10)’s are positive and rising. Near term and short term technicals are positive and indicating upward bias. The S&P and DJIA, however, have moved up against the upper boundary of the trading range and have pulled back. We have also seen reversal candlesticks develop in the last several sessions, with the DJIA and S&P developing ‘hanging mans’ in the last session.
We have the Nasdaq100 looking like it wants to break out of the range trade, while the S&P and DJIA began a pullback from the top of range. The DJIA and S&P also remain below the Fibonacci(.38) retracement level of the last leg down. With the mixed signals and the volatility remaining high(VIX over 30), and extremely low volume, we see no conviction to suggest a strong move in either direction. The ‘range trade’ continues. Some economic reports scheduled this morning, which may move the Market. Good Google numbers last night, have futures pointing to a positive open.
Major Economic Reports TodayRetail Sales-8:30am Export/Import Prices-8:30am Mich. Sentiment-9:55am Bus. Inv.-10:00am Treasury Budget-2:00pm
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