Stock market spikes higher after dull Tuesday

Market Snapshot for session ending 2-14-12:

 

Last

Day Change

%Change

S&P 500 Index

1350.50

-1.27

-.09%

Dow Jones Industrials

12878.28

+4.24

+.03%

NASDAQ Composite

2931.83

+.44

+.02%

Value Line Arithmetic Index

3004.85

-7.95

-.26%

Minor Cycle
(Short-term trend lasting days to a few weeks)
Positive / Neutral

Intermediate Cycle
(Medium trend lasting weeks to several months)
Positive

Major Cycle
(Long-term trend lasting several months to years)
Positive / Neutral

Market Overview – What We Know:

  • Major indexes closed mixed Tuesday, but in overnight trading bellwether S&P 500 Emini futures contract rallied several points to suggest S&P could move to new short term high via Wednesday’s trading.
  • Daily CPFL bettered its October 28 resistance high Tuesday with a positive ratio of 2.15 to 1, but indicator continues to remain substantially below February 25, 2011 high.
  • Trading volume in S&P 500 rose by nearly 15% Tuesday.
  • Short and Intermediate-term trends remain “Overbought.”
  • Minor cycle advance in S&P has been underway since short-term low (1202.27) on December 19 and has accrued an advance of just over 12%.
  • Weakness below lower edge of 10-Day Price Channel (1326.97—Wednesday) would suggest beginning of end of Minor Cycle uptrend.
  • Short-term Momentum in S&P 500 remains marginally positive.
  • Daily MAAD was negative Tuesday by 5 to 14 and was last plotted 12 issues below its February 8 short-term high and best level since March 4, 2008. Weekly MAAD continues to underperform Daily series.
  • Cumulative Volume (CV) in S&P 500 remains above late October resistance highs, but Emini CV remains weak.
Index Daily / Weekly / Monthly Stops Weekly Monthly
2/13 2/14 2/15 2/16 2/17 2/17 2/29

S&P 500
Index

SELL
1318.59

SELL
1322.50

SELL
1326.97

SELL
1331.30

SELL
1333.74

SELL
1230.02

SELL
1218.82

Dow Jones
Industrials

SELL
12664.54

SELL
12690.04

SELL
12718.84

SELL
12748.55

SELL
12756.81

SELL
11938.90

SELL
11481.71

NASDAQ
Composite

SELL
2837.09

SELL
2849.37

SELL
2860.86

SELL
2872.61

SELL
2880.65

SELL
2578.28

SELL
2592.57

Value Line
Index

SELL
2925.40

SELL
2941.29

SELL
2956.08

SELL
2968.44

SELL
2974.61

SELL
2630.47

SELL
2708.65

Market Overview – What We Think:

  • Overnight upward spike in S&P 500 Emini futures contract could spur index prices higher in early trading Wednesday.
  • S&P remained 1.46% from equaling its May 2011 high at 1370.58 as of Tuesday’s close.
  • Lacking confirmation from majority of our key indicators, rally since October lows leaves rally in doubt. Ultimate status of Intermediate to Major Cycles will be determined once short-term advance ends and bias of indicators relative to pricing is assessed.
  • Market’s true internal “health” as measured by indicators ought to determine staying power of pricing. Higher prices can occur, but without indicator confirmation, strength is definitely suspect.
  • Ongoing struggle relative to 2011 highs gives us feeling there is certain inevitability about this market which could ultimately be bearish.

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