Stock market trading in narrow range for third week

MAAD, CPFL indicator review

Stock index, chart, technical analysis Stock index, chart, technical analysis

 

Market Snapshot for session ending 10-01-12
 

Last

Day Change

%Change

S&P 500 Index

1444.49

+3.82

+.27%

Dow Jones Industrials

13515.11

+78.01

+.56%

NASDAQ Composite

3113.53

-2.69

-.09%

Value Line Arithmetic Index

3065.28

+7.25

+.24%

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

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

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

Market Overview – What We Know:

  • Major indexes, excepting NASDAQ Composite, posted marginal gains Monday.
  • NYSE trading volume declined 19% as compared to Friday’s activity. Average Price per Share rose 20 cents to $61.40.
  • Short-term trend remains negative unless S&P 500 rises above upper edge of trailing 10-Day Price Channel (1463.55 through Tuesday).
  • Intermediate Cycle remains positive until lower edge of 10-Week Price Channel (1374.62 through October 5).
  • Weekly MAAD was positive Monday with 14 issues higher and 6 lower. Daily indicator was last below July 3 peak while holding well below March 20 high to suggest Smart Money remains skeptical of this market.
  • CPFL was positive Monday by 1.26 to 1, but remains below September short to intermediate high and is nowhere close to major resistance made week of February 25, 2011.
  • Cumulative Volume (CV) in both S&P 500 and S&P Emini remains weaker than index pricing on both Daily and Weekly trends.

Market Overview – What We Think:

  • With Minor Cycle stats now ranging from “Neutral” to “Oversold,” it remains to be seen whether or not market action over past two weeks will prove to be yet another corrective phase in Intermediate Cycle advance initiated after June lows, or something more negative on larger Intermediate Cycle.
  • To resolve issue, S&P 500 must sell below rising uptrend line (last near 1410) with follow through weakness below lower edge of 10-Week Price Channel (1374.62). Weakness below latter point would almost certainly terminate four-month-old rally.
  • In meantime, nothing but strength back above September 14 intraday high (1474.51) would re-assert Intermediate Cycle advance. Between here and there (uptrend/Price Channel and resistance) coin will continue to flip.
  • Indicators such as Daily Most Actives Advance/Decline Line (MAAD) still suggest market has gotten way ahead of itself. Daily MAAD has come nowhere near overcoming March 20 resistance high even though indicator participated, albeit feebly, on upside after June lows. MAAD failure hints Smart Money has only been buying a bit more than it has been selling over past few months.

 cumulative, volume, stock

stock, market, cumulative, emini

Index Daily / Weekly / Monthly Stops Weekly Monthly
 

10/1

10/2

10/3

10/4

10/5

10/5

10/31

S&P 500 Index

BUY  
1462.89

BUY  
1463.55

BUY  
1459.80

BUY  
1457.58

BUY  
1455.04

SELL  
1374.62

SELL  
1269.05

Dow Jones Industrials

BUY  
13598.43

BUY  
13609.23

BUY  
13589.90

BUY  
13576.29

BUY  
13557.20

SELL  
12887.24

SELL  
12141.09

NASDAQ Composite

BUY  
3181.78

BUY  
3182.68

BUY  
3171.87

BUY  
3165.52

BUY  
3157.91

SELL  
2960.06

SELL  
2716.62

Value Line Index

BUY  
3133.68

BUY  
3131.78

BUY  
3118.39

BUY  
3109.23

BUY  
3099.22

SELL  
2886.89

SELL  
2723.41

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.

Page 1 of 2 >>
Comments
comments powered by Disqus