Stock market minor cycle dicey

Or second, the short-term weakens further, the uptrend line stretching back toward those August retest lows is terminated, and the Intermediate-term Cycle in effect since early July is challenged. In this case we would look for a possible test of Intermediate-term statistical supports toward defined 10-week Price Channels (see Table Below), but not a termination of the Intermediate-term advance itself.

Or third, more concerted selling develops and not only is the Intermediate Cycle challenged, but the uptrend that began last July is ended, albeit within the context of a still positive Major Cycle advance that would allow price weakness to the lower edge of defined 10-Month Price Channels (See Table below).

Index

Daily Stops

Weekly Monthly
2/28 3/1 3/2 3/3 3/4 3/4 2/28

S&P

Last
1319.88

BUY
1334.86

BUY
1336.25

BUY
1333.54

BUY
1329.67

BUY
1327.82

SELL
1276.64

SELL
1054.96

Dow 30

Last
12130.45

BUY
12303.06

BUY
12323.45

BUY
12309.50

BUY
12279.24

BUY
12255.14

SELL
11744.97

SELL
9977.84

NASDAQ

Last
2781.05

BUY
2821.17

BUY
2820.27

BUY
2810.71

BUY
2798.80

BUY
2794.39

SELL
2713.76

SELL
2145.96

Val. Line

Last
3005.51

BUY
3039.85

BUY
3043.33

BUY
3036.19

BUY
3024.12

BUY
3020.28

SELL
2908.12

SELL
2241.20



Note: Stop levels, a function of the extant trend, are based on the trailing moving average price channels for the Highs or the Lows of an index. Whether or not a specific index is suggesting a "Buy" or Sell" is determined by whether or not index prices are above or below the current channel Stop levels. Stop levels should only be used as an entry or exit guide and in conjunction with other market entry and exit strategies.

McCurtain Most Actives Advance/Decline Line (MAAD)
Last week Daily and Weekly MAAD data were unable to better their February 17 and 18 highs and the best levels since March 2009. But given the limited nature of selling, so far, in the broad market over the past several days and the somewhat anemic reaction of this indicator to weakness and the fact the Daily MAAD Ratio has already dipped into "oversold" territory, it’s possible that selling could prove to be relatively short lived even if bids progress somewhat below last Thursday’s lows.

We must continue to point out, however, and this has been one of our pet themes for months, that MAAD relative to broad market action has not done as well since March 2009 as in previous market up moves. While there may be many reasons as to why the so-called "Smart Money" has been less enthusiastic that previously, the fact is that it has. Put another way, it would take far less market weakness to push MAAD down to new lows than it would index prices unless there was catastrophic selling, an eventuality that does not seem likely at this time.

Click charts to enlarge

McCurtain Call/Put Dollar Value Flow Line (CPFL)
Despite selling in the major indexes last week, CPFL rallied to new highs for the move on both the Daily and Weekly Cycles to suggest that options players remain optimistic. While this divergence from price action does not preclude more weakness in the broad market, it does suggest that the lack of a defined upside disparity could accrue to the benefit of the bulls on the short-term in that any weakness which develops could be of short-term term duration and could prove to be a buying opportunity.

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