Market up Wednesday, but intermediate trend negative

Daily CPFL was positive Wednesday by 1.58 to 1

Bull shadow, stock index chart Bull shadow, stock index chart

Market Snapshot for session ending 6-27-12

 

Last

Day Change

%Change

S&P 500 Index

1331.85

+11.86

+.90%

Dow Jones Industrials

12627.01

+92.34

+.74%

NASDAQ Composite

2875.32

+21.25

+.74%

Value Line Arithmetic Index

2813.30

+32.66

+1.17%

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

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

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

Market Overview – What We Know:

  • Major indexes tacked on small gains Wednesday on heels of Monday’s strength.
  • Short-term trend, as measured by S&P 500, remains challenged to extent S&P pricing continues to flirt with boundaries of 10-Day Price Channel. After threatening on downside Monday, S&P was last just above upper edge of 10-Day Channel (1328.96 through Thursday).
  • With larger Intermediate Cycle negative until upper edge of 10-Week Price Channel (1379.34—S&P 500 through June 29), larger trend continues to exert downward influence.
  • Minor Cycle, as measured by MAAD Daily Ratio was modestly “Overbought” at 1.48 Wednesday. Daily MAAD was near even with 15 issues higher and 4 lower. One was unchanged.
  • Daily CPFL was positive Wednesday by 1.58 to 1. Overall options volume was sub-normal.
  • Cumulative Volume (CV) in S&P 500 and S&P Emini futures contract remains in synch with underlying S&P 500 pricing, but is somewhat weaker on cumulative basis.

Market Overview – What We Think:

  • Pricing in major indexes continues to jockey for position on Minor Cycle, but so long as larger Intermediate Cycle remains negative, burden of proof remains with bulls.
  • Since moderately “Overbought” conditions continue to suggest negative resolution of short-term trend, we think any strength should be viewed with skepticism.
  • To confirm solid negative resolution to larger Intermediate Cycle, however, S&P must break below June 4 S&P low at 1266.77.
  • If June 4 lows are fractured on downside, bigger problems like weakness below 200-Day lines near 1300—S&P 500 and long-term uptrend line near 1225—S&P 500 would surface.
  • While some measurements of intermediate trend are currently registering “Oversold,” it’s important to remember OB/OS measurements can be somewhat subjective indication of market “temperature” and can persist.
  • If larger Intermediate Cycle resumes downward course and “normal” correction of advance since last October fully evolves, weakness in S&P 500 toward 1283-1213 could develop.

Click charts to enlarge

cumulative volume, s&p

cumulative, volume, emini

Index Daily / Weekly / Monthly Stops Weekly Monthly
 

6/25

6/26

6/27

6/28

6/29

6/29

6/30

S&P 500 Index

SELL1316.12

SELL1322.77

SELL1328.42

SELL1328.96

SELL1329.56

BUY1379.34

SELL1185.81

Dow Jones Industrials

SELL12502.01

SELL12562.44

SELL12610.72

SELL12614.37

SELL12617.79

BUY13019.48

SELL11413.64

NASDAQ Composite

SELL2820.87

SELL2838.63

SELL2853.79

SELL2587.26

SELL2861.43

BUY3002.57

SELL2501.62

Value Line Index

SELL2764.31

SELL2776.54

SELL2791.39

SELL2793.68

SELL2796.16

BUY2973.79

SELL2551.83

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.

Next page: Indicator review

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