Stock indexes see profit taking, mixed signals

Short-term momentum has confirmed none of recent strength

Market Snapshot for session ending 3-21-12:

 

Last

Day Change

%Change

S&P 500 Index

1402.89

-2.63

-.19%

Dow Jones Industrials

13124.62

-45.57

-.35%

NASDAQ Composite

3075.32

+1.17

+.04%

Value Line Arithmetic Index

3069.14

+1.31

+.04%

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

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:

  • Stock market ended mixed Wednesday with bluer chips (S&P 500, Dow 30) down slightly and secondary issues (NASDAQ and Value Line) ahead a little.
  • Short and Intermediate-term trends remain positive and “Overbought.”
  • NYSE trading volume was down 2% while average NYSE share price lost 18 cents to $58.32. Highest recent valuation was March 15 at $61.48.
  • Short-term Momentum has confirmed none of recent strength in any of major indexes to best bids for move. Nor has Intermediate Cycle Momentum.
  • Cumulative Volume in S&P 500 and S&P Emini futures contract remain below new short-term highs reached Monday.
  • Daily Most Actives (MAAD) rallied to new short to intermediate high Tuesday along with CPFL, but faded slightly Wednesday while CPFL hit a new minor high.

Market Overview – What We Think:

  • Profit-taking on Minor Cycle could develop into full blown pullback if index pricing fades below lower edge of 10-Day Price Channels (1371.22—S&P 500 on Thursday). If not, Intermediate Cycle uptrend begun after October lows would remain intact.
  • Failure of Momentum on both short and intermediate cycles could be sign recent bout of strength is abating. Fact that market is “Overbought” is helpful even though measurements are not definitive since “Overbought” readings can stay that way. It is reversals of those conditions that count, not the extreme conditions themselves.
  • And while Cumulative Volume (CV) in S&P, Dow 30, and NASDAQ has improved via recent strength, failure in all to overcome major indicator resistance at 2011 highs underscores lack of participation since October, despite price gains.

 

Index

Daily / Weekly / Monthly Stops

Weekly

Monthly

   3/19  3/20  3/21  3/22  3/23  3/23  3/31

S&P 500 Index

SELL1357.79

SELL1360.14

SELL1365.66

SELL1371.22

SELL1377.87

SELL1299.77

SELL1189.77

Dow Jones Industrials

SELL12863.34

SELL12876.89

SELL12929.20

SELL12977.92

SELL13033.64

SELL12494.26

SELL11271.99

NASDAQ Composite

SELL2950.94

SELL2958.93

SELL2971.50

SELL2985.32

SELL2999.78

SELL2766.84

SELL2517.37

Value Line Index

SELL2962.87

SELL2968.54

SELL2980.64

SELL2992.47

SELL3008.95

SELL2845.49

SELL2612.10

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.

Click charts to enlarge

Next page: Indicator review

Page 1 of 2 >>
Comments
comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome