Market Commentary: DOW Squeaks Out New High With Obvious Market Weakness

July 14th, 2014
in Gary's blogging, midday post

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Midday Market Commentary For 07-14-2014

The DOW made a failed second attempt to best its morning high and then wiggled its way up to 17088 although remaining in a narrow trading zone. The small caps continued to melt upwards as the $NDX made a new high as volume fell to anemic levels..

By noon the markets were showing sighs of weakness and trading sideways, but this may be simply part of the consolidation phase before moving higher.

Follow up:

I know a lot of analysts are calling for a major correction at any time now, but I feel we will only see a minor one - MAYBE 10%, assuming one happens. Never the less, I would use caution and not throw caution to the wind as the $VIX has and mind your stops. The markets are not strong as some believe and are going to get a lot more 'ify' as we approach 2015.

Polls like the one below are compiled from the most uninformed and can shed a lot of light of where the markets are headed by going in the opposite direction of retail investors exuberance.

Bull market has longer to run: MarketWatch readers

MarketWatch readers appear to be optimistic the bull market in stocks has longer to run.

An informal poll asking what phase of the bull market readers felt we are in drew more than 3,000 responses Friday.

The poll gave readers a choice from among the four stages of a bull market identified by Sir John Templeton and Laszlo Birinyi. A plurality of readers, 35%, indicated we are still only in the third phase "optimism / acceptance."

The next largest group picked the second phase, "skepticism / digestion." Only 22% picked the final phase "euphoria / exuberance," while 14% picked the first phase "pessimism / reluctance," or "Other."

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The medium term indicators are leaning towards the hold side at the midday. 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. The SP500 MACD has turned down, but remains above zero at 12.28. I would advise caution in taking any position during this volatile period. shows a 88 % buy. (Been at 88% for the last 5 sessions, I think their meter is broken) members' sentiments are 61 % bearish and Investors Intelligence sets the breath at 67.7 % bullish with the status at Bear Correction. (Chart Here *) NYSE Bullish Percent Index ($BPNYA) is at 72.67. (Chart Here ) S&P 500 Bullish Percent Index ($BPSPX) is at 84.20. (Chart Here )

The markets are still susceptible to climbing on 'Bernankellen' vapor, use caution!

If you would like to get advanced buy/sell tweets, sign-up in the column to the right of this post by clicking on the 'Follow' button. Write me with suggestions and I promise not to bite.

The DOW at 12:00 is at 17077 up 134 or 0.79%.

The SP500 is at 1979 up 11 or 0.57%.

SPY is at 197.74 up 1 or 0.57%.

The $RUT is at 1168 up 8 or 0.71%.

NASDAQ is at 4447 up 32 or 0.71%.

NASDAQ 100 is at 3933 up 29 or 0.74%.

$VIX 'Fear Index' is at 11.54 down 0.54 or -4.47%. Neutral 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 net neutral and the current bias is elevated and sideways.

How Oil Really Gets Priced

WTI oil is trading between 100.96 (resistance) and 100.26 (support) today. The session bias is positive, volatile and is currently trading down at 100.89.

Brent Crude is trading between 108.10 (resistance) and 106.30 (support) today. The session bias is elevated and is currently trading down at 107.65. (Note: there is a 32 cent gap at 106.62 that needs to be filled. Occurred at 11:30 am on 7-13-2014)

Gold fell from 1340.57 earlier to 1304.11 and is currently trading down at 1308.30. The current intra-session trend is negative and trading sideways.

Dr. Copper is at 3.261 falling from 3.294 earlier.

The US dollar is trading between 80.28 and 80.11 and is currently trading down at 80.20, the bias is currently neutral and quiet.

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Written by Gary


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