Written by Gary
Midday Market Commentary For 10-17-2013
Markets continue to melt upward as volume shrinks only the DOW remains in the red. The market as a whole is up 0.30% boosted by a shot of 'Hopium' from last nights Congressional 2 ring circus where the elephants were lead to the shed after trying to dump on the House floor.
By noon the averages looked tired, very tired and running out of steam.
Although the markets have 'recovered' to something better than flat status, the ominous signs of the bears rustling in the wings has a lot of investors worried and for good reason. Late this afternoon might be a good time to experiment with a inverse ETF or two.
The market has had a lot to digest lately. The government shutdown and budget talks, Janet Yellen being nominated as the next Fed Chair and the start of earnings season, just to name a few.
Overall, the market has done well digesting and absorbing the news, and the bulls make a strong argument the uptrend will resume as soon as the circus on Washington ends. But, there are a few warnings under the hood. Consider the following breadth charts.
S&P 500 vs. SPX Bullish % Index:
The May high was accompanied by a full 90 percent of the S&P 500 (NYSE: SPY) stocks having buy signals on their point-n-figure charts. But at the August high the number dropped to 85 percent, and at the September high less than 80 percent had buy signals.
Such a divergence, which tells us the market is being carried higher by a smaller number of stocks, can last in the near term, but eventually the lack of broad participation is likely to pull the market down.
The DOW at 12:15 is at 15314 down 60 or -0.38%.
The SP500 is at 1725 up 4 or 0.25%.
SPY is at 172.57 up 0.51 or 0.30%.
The $RUT is at 1098 up 5 or 0.48%.
NASDAQ is at 3851 up 11 or 0.29%.
NASDAQ 100 is at 3291 up 9 or 0.28%.
The longer trend is up, the past months trend is bullish, the past 5 sessions have been positive and the current bias is positive.
WTI oil is trading between 102.95 and 100.15 today. The session bias is negative and is currently trading down at 100.43.
Brent Crude is trading between 111.27 and 109.10 today. The session bias is negative and is currently trading down at 109.17.
Gold rose from 1278.85 earlier to 1323.10 and is currently trading up at 1320.20.
Dr. Copper is at 3.292 falling from 3.325 earlier.
The US dollar is trading between 80.85 and 79.68 and is currently trading up at 79.78, the bias is currently negative.
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Written by Gary