Written by Gary
Opening Market Commentary For 07-23-2014
Premarket recovered nicely from yesterday's 'disturbing' -0.45% sell-off by starting out at +0.10%. The markets opened with a flourish sending the SP500 to a new high (1987.46), but then diving down -0.15%, then recovering somewhat to +0.10%. The DOW just went down and the NASDAQ made a session double top matching 1997 highs and is in the process of retreating.
By 10 the volatility is VERY high with volume ranging from moderate to high and I expect some negative numbers before this session is done.
The medium term indicators are leaning towards the hold side at the opening. 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 9.97. I would advise caution in taking any position during this uncertain period.
Barchart.com shows a 88 % buy. (Been at 88% for the last 8 sessions, I think their meter is broken) Investing.com members' sentiments are 61 % bearish and Investors Intelligence sets the breath at 66.9 % bullish with the status at Bear Correction. (Chart Here )
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)
In Lance Roberts article he asks, Is The Market Consolidating Or Topping?
There are two ways to look at stagnation in the markets. It is either a consolidation process that works off an overbought condition which leads to further advances, OR it is a topping process that leads to a market decline. Discerning which process is currently "in play" is critical for investor decision making.
Let me be clear. I am not stating that the current consolidation process will absolutely collapse into a sharp correction in the months ahead. However, I am stating that the current environment is more similar to past markets which did correct, than not.
While it is certainly possible that the markets could ratchet higher from here due to the "psychological momentum" that currently exists, the likelihood of a runaway bull market from here is remote.
The markets are still susceptible to climbing on 'Bernankellen' vapor, use caution!
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The DOW at 10:15 is at 17084 down 32 or -0.18%.
The SP500 is at 1985 up 1.55 or 0.08%.
SPY is at 198.41 up 0.20 or 0.10%.
The $RUT is at 1158 up 2 or 0.18%.
NASDAQ is at 4467 up 11 or 0.26%.
NASDAQ 100 is at 3976 up 14 or 0.36%.
$VIX 'Fear Index' is at 11.87 down 0.38 or -3.10%. 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 positive and the current bias is elevated, volatile and sideways.
WTI oil is trading between 102.71 (resistance) and 101.92 (support) today. The session bias is positive and is currently trading down at 102.63.
Brent Crude is trading between 108.04 (resistance) and 107.02 (support) today. The session bias is positive and is currently trading down at 107.81.
Gold fell from 1311.63 earlier to 1305.38 and is currently trading up at 1309.30. The current intra-session trend is sideways with a lot of volatility.
Dr. Copper is at 3.208 falling from 3.217 earlier.
The US dollar is trading between 80.88 and 80.80 and is currently trading down at 80.84, the bias is currently neutral, sideways and volatile.
Real Time Market Numbers
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Written by Gary