Written by Gary
Closing Market Commentary For 03-21-2014
Hard to tell what 'really' drove the market up this morning as the HFT computers are suspect along with anemic volume. Whatever the cause it didn't last as the averages slowly, methodically and with certainty slide down into the bears clutches ending the session in red. However, not all is lost as some of the indicators, if you can trust them, still show that the bull is still in charge.
By 4 pm the averages ended the week a bit battered, tired and looked worse off than they really were.
We are in a sideways trough that has had precedents of breaking one way or another. The end of the 12-18-13 sideways move was up ~4%. The one after that ending 1-24-14 fell 6% and then recovered. What is it going to be this time?
Quad-witching only added to an extremely volatile week as the entire bond, stock, FX complex pumped and dumped on the basis of whether a "considerable period" was really six months and whether "quite some time" was more or less than six months.
The S&P hit record highs early on this morning thanks to a ramp in AUDJPY (but once again bonds didn't blink). All that ended when Europe closed and the Biotech sector's weakness spread, leaving the Nasdaq -1.4% post-FOMC (and all other indices in the red post-FOMC).
The range of moves in bonds, FX, commodities, and vol this week were impressive as we noted below...
The short term indicators are leaning towards the hold side at the closing. The all important signs of reversal, up or down, have not been observed so we are mostly, at best, neutral and conservatively holding. The 50DMA, MACD, volume and a host of other studies have not turned, only a 6% correction (and recovery) and that is not enough for me to start shorting. I would advise caution in taking any position during this volatile transition period although Barchart.com shows a 56 % sell.
The Best Stock Market Indicator Update says the market is untradable. The OEXA200R ended the week at 80%, down from 82% last weekend.
Of the three secondary indicators:
RSI is NEGATIVE (below 50).
MACD is NEGATIVE (black line below red).
Slow STO is POSITIVE (black line above red).
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The DOW at 4:00 is at 16303 down 28 or -0.17%.
The SP500 is at 1866 down 5.61 or -0.30%.
SPY is at 186.20 down 0.72 or -0.38%.
The $RUT is at 1194 down 5 or -0.44%.
NASDAQ is at 4277 down 43 or -0.98%.
NASDAQ 100 is at 3653 down 41 or -1.11%.
$VIX 'Fear Index' is at 15.00 up 0.48 or 3.31%. Bullish Movement
The longer trend is up, the past months trend is positive, the past 5 sessions have been mixed and the current bias is negative.
WTI oil is trading between 98.26 and 100.23 today. The session bias is positive and is currently trading down at 99.50. (Tested 100 and has backed off and looks to be headed down again.)
Brent Crude is trading between 106.01 and 107.75 today. The session bias is positive and is currently trading down at 106.95. (Brent may also be headed down)
Gold rose from 1329.72 earlier to 1343.00 and is currently trading up at 1334.30. The current intra-session trend is negative.
Dr. Copper is at 2.950 rising from 2.916 earlier.
The US dollar is trading between 80.50 and 80.18 and is currently trading up at 80.27, the bias is currently sideways.
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Written by Gary