The market has gained some ground since my last post but there were no technical developments to change my opinion on things. I'm still skeptical of this attempt at new highs. The indices are now firmly overbought and there's been poor volume behind this rally. At best (for now) the Nasdaq and S&P are range-bound. I'm sticking with that theory until it's proven incorrect. Given that and the overbought stochastic readings I'm looking for a move back toward the bottom of the range. I'm also finding a lot of short candidates among stocks which are stalling near their 50-day moving averages. (That's one of the things William O'Neil looks for in short candidates. Those stocks that peaked in the spring are really lining up with his criteria.)
The small caps have a long way to go to catch up with the larger cap indices. This chart really looks like a failing rally...
No changes
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Up | Up | Up |
| Intermediate | Up | Up | Lat |
| 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.
Yes...some great comments. I'm Cautiously Bullish...I think the short term trends will be volatile; however, the long term trends are bullish.
Thanks for your insights.