Market Commentary: Markets Remain Depressed At The Close, DOW Down Triple Digits

July 25th, 2014
in Gary's blogging, market close

Written by

Closing Market Commentary For 07-25-2014

Trading was in a narrow band of sorts as the BTFDers tried several time to move the averages back up into the green zone.

By 4 pm the trend was fractionally trending down, no last minute sell-off and no word from Mr. Market on what he planned for us on Monday.


Follow up:

One more notch in the bears gun. Weekend commentary out tomorrow morning.

High Yield Credit Market Flashing Red As Outflows Surge

As we have been highlighting for a few weeks, something is rotten in high-yield credit markets.

This week, the mainstream media is starting to catch on as major divergences in performance (high-yield bond spreads are 30-40bps off their cycle tights from just prior to MH17 even as stocks rally to new record highs) and technicals weaken.

However, as BofA warns, flows follow returns and this week saw the biggest outflows from high-yield funds in more than a year.

Investment grade bonds saw notable inflows as investors chose up-in-quality, rather than reach-for-yield, for the first time in years... equity investors, pay attention.

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. The SP500 MACD has turned down, but remains above zero at 9.74. I would advise caution in taking any position during this uncertain period.

Investing.com members' sentiments are 58 % bearish and Investors Intelligence sets the breath at 67.1 % bullish with the status at Bear Correction. (Chart Here )

StockChart.com NYSE Bullish Percent Index ($BPNYA) is at 71.17. (Chart Here)

StockChart.com S&P 500 Bullish Percent Index ($BPSPX) is at 82.60. (Chart Here)

StockChart.com Overbought / Oversold Index ($NYMO) is at -14.83. (Chart Here)

StockChart.com Consumer Discretionary ETF (XLY) is at 66.73. (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) We have crossed the support, let's see where this goes from here. Is this the signal for the start of the correction?

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 4:00 is at 16960 down 124 or -0.72%.

The SP500 is at 1978 down 10 or -0.49%.

SPY is at 197.72 down 0.93 or -0.47%.

The $RUT is at 1145 down 11.54 or -1.00%.

NASDAQ is at 4450 down 23 or -0.50%.

NASDAQ 100 is at 3965 down 18 or -0.45%.

$VIX 'Fear Index' is at 12.55 up 0.71 or 6.00%. Bearish 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 positive and the current bias is negative and sideways.

Cushing Drawdown Not A Concern For The Oil Market by Hard Assets Investor

WTI oil is trading between 102.49 (resistance) and 101.00 (support) today. The session bias is neutral and is currently trading down at 101.89.

Brent Crude is trading between 108.43 (resistance) and 106.74 (support) today. The session bias is positive, volatile and is currently trading down at 108.21.

Gold: Drops To 1-Month Low Below $1300 by Dean Popplewell

Gold rose from 1291.19 earlier to 1308.60 and is currently trading up at 1308.20. The current intra-session trend is positive and very volatile.

Dr. Copper is at 3.245 falling from 3.277 earlier.

The US dollar is trading between 81.17 and 80.90 and is currently trading up at 81.14, the bias is currently positive.

Real Time Market Numbers

Leading Stock Quotes powered by Investing.com

To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

Written by Gary









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