We got a little bit of a smackdown today as sellers continued yesterday's late-day selling. I'm still wondering if this is the "Sell in May and Go Away" trade starting to play out. Time will tell...
Perhaps I'll be able to stop mentioning all the 200-day moving averages since the indices are all back below them now (except the Nasdaq-100/QQQQ). Volume was mixed today -- it increased on some indices and decreased on others. Likewise, some indices has more technical damage than others. The Dow looks the worst to me (not that I care about the Dow) since it broke its March trendline on increasing volume today. It's also working on a double-top, albeit a very short & shallow one:
Volume also increased on the S&P 500. I talked about how something would have to give as the March trendline and the 200-day moving average converge. Well we're just days away from them touching and price will have to break through one of them when that happens -- unless it goes sideways and breaks them both. :-)
The Nasdaq got the same stochastic sell signal as many other indices. It still has a good deal of room before its March uptrend is in danger though.
I probably should downgrade the S&P's long-term back to down but I'm going to wait to see if it bounces in order to save myself the whipsaw.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Primary | Lat | Lat | Down |
| Intermediate | Up | Up | Up |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I'm simply using the indices' relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
Hi Mike - thanks for this blog. I'm a long time reader.
Have a question about your trend durations in the table. Primary, I'm assuming, is daily. Intermediate and short term use other periods but with the same moving averages. Correct? What are the periods for those 2?
Thanks much!
Sunil,
Primary is "long term". Think weeks to months. That's why I base it off of the 200-day moving average. The short term trend would be more like days.
I've never thought of them as assigned to specific periods but I guess if you wanted to think of it that way you could just use the length of the moving averages that they're based on. So primary would be the 200 day period, intermediate would be 50 days and short term would be 10 days.