Market Commentary: Averages Melt Up, Close Higher On Anemic Volume
Written by Gary
Closing Market Commentary For 09-10-2014
Markets melted up from its 10:30 am lows primarily due to HFT algo computer trading on anemic volume. When the humans don't trade, it becomes a free-for-all for the HFT crowd and any positive roles that seem apparent should be disregarded.
By 4 pm the NASDAW rose +0.08% while the large caps rose to +0.3%. Not bad numbers by any measure, but not a real market delimiter by any means. The markets remain at another crossroad and it is uncertain whether the impending 'correction' is going to be the 'Big One'.
The medium term indicators are leaning towards the hold side at the close. The all important signs of reversal, up or down, have not been observed so we are mostly, at best, neutral and conservatively holding. The important DMA's, volume and a host of other studies have not turned and that is not enough for me to start shorting, but now I am very concerned. The SP500 MACD has turned flat, but remains above zero at 10.64. I would advise caution in taking any position during this uncertain period although some technical indicators have starting to turn bearish.
Investing.com members' sentiments are 64 % Bearish and when it switches over to bullish, as it did on Tuesday 8-5, watch for the market bottom to fall out some are saying as the markets usually go against 'Sheeple' buying high and selling low.
StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 25.34. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009. Moving up – bearish.
StockChart.com Overbought / Oversold Index ($NYMO) is at -37.34. (Chart Here) (Need to type in $NYMO) It is now around the area where it turns and starts to descend, but any thing below -30 / -40 is a concern. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. Wednesday, 8-20-2014, $NYMO climbed to 58.24 is signaling a market reversal and apparently it has started – which is short term bearish.
Chris Ciovacco says, "As long as the consumer discretionary ETF (NYSEARCA:XLY) holds above 67.06, all things being equal, it is a good sign for stocks and the U.S. economy." (Actually the support looks to be in the 66.88 range) This chart clearly shows that dropping below 65.50 should be of a great concern to bullish investors. Wednesday, 9-3-2014, XLY edged up to 69.25 and that is another notch in the gun signaling that we might have another reversal very soon – at least to cover the gap below at 67.85. Protect thyself!
The DOW at 4:00 is at 17069 up 55 or 0.32%.
The SP500 is at 1996up7 or 0.36%.
SPY is at 200.07up0.75 or 0.38%.
The $RUT is at 1165 up 6 or 0.56%.
NASDAQ is at 4587 up 34 or 0.75%.
NASDAQ 100 is at 4095 up 33 or 0.81%.
$VIX 'Fear Index' is at 12.88 down 0.62 or -4.59%. Bullish Movement
(Follow Real Time Market Averages at end of this article)
The longer trend is up, the past months trend is positive, the past 5 sessions have been negative and the current bias is Positive.
WTI oil is trading between 93.02 (resistance) and 91.27 (support) today. The session bias is negative and sideways and is currently trading down at 91.77. (Chart Here) There is a very large gap at 97.06 and these types of gaps are usually filled sooner rather than later. It would not surprise me to see the oils move back up in the very near future. (Chart Here) (Look at the 5H time scale.)
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The general consensus is that gold prices will actually fall in the next twelve months (Sept to Aug. 2015). Goldman Sachs estimates that gold will fall to $1,050 an ounce, a drop of nearly 19%.
Gold fell from 1258.47 earlier to 1244.58 and is currently trading down at 1250.50. The current intra-session trend is negative, but trending higher. (Chart Here)
Dr. Copper is at 3.114 rising from 3.093 earlier. (Chart Here)
The US dollar is trading between 84.56 and 84.24 and is currently trading up at 84.41, the bias is currently trending sideways and volatile. (Chart Here) >>>> There is a gap below between 83.92 and 83.79, watch out below as any rise is expected to be temporary.<<<<<<
The markets are still susceptible to climbing on 'Bernankellen' vapor, use caution!
"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation inequities, they should try to be fearful when others are greedy and greedy only when others are fearful." - Warren Buffett
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Written by Gary