Market Commentary: Markets Close Flat And Unattractive On Anemic Volume

August 6th, 2014
in Gary's blogging, market close

Written by

Closing Market Commentary For 08-06-2014

We closed about where we were at yesterday's close and now investors have many questions regarding future direction of Mr. Market. Overall, the positives outweigh the negatives, BUT and that is a big 'but', the SP500 closed above the 100 DMA once again, along with SPY, but the DOW closed below the 145 DMA again.

By 4 pm volume was anemic for most of the afternoon looking like we have stalled in the middle of the crossroad. I swear I can hear a bear growling.

Follow up:

The DOW and the $RUT have the largest issues and until we see them rise, I do not expect the market to fair well.

The $NDX closed just above the 50 DMA and the NASDAQ closed below that line in the sand for the second session. What does this mean in layman's language? It means a lot of folks are scared of this much talked about correction we haven't had in several years and things are not going well in spite of the Fed's reassurances.

This mini-correction has gone on longer than previous ones by several days, but the decline has been about the same in percentage numbers. At this point I would expect the market to start rising and would love to see previous highs challenged.

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 below zero at -7.62. I would advise caution in taking any position during this uncertain period although some technical indicators are starting to turn bearish. members' sentiments are 44 % bearish and when it switches over to bullish, as it did on Tuesday 8-5, watch for the market bottom to fall out some are saying, as the markets usually go against 'Sheeple' buying high and selling low.

Investors Intelligence sets the breath at 59.5 % bullish with the status at Bear Confirmed. (Chart Here ) NYSE Bullish Percent Index ($BPNYA) is at 62.58. (Chart Here) Very close to support. S&P 500 Bullish Percent Index ($BPSPX) is at 71.80. (Chart Here) Closed below support.

The Market Is Overpriced But The Correction Will Likely Be Shallow Overbought / Oversold Index ($NYMO) is at -78.56. (Chart Here) (Need to type in $NYMO) Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50, but this time things may be different - where have I heard this before? Tuesday's (8-5) numbers are definitely not a good sign. Consumer Discretionary ETF (XLY) is at 65.68. (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 entered an area that concerns me should the XLY drops any further.

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 16443 up 14 or 0.08%.

The SP500 is at 1920 up 0.03 or 0.00%.

SPY is at 192.02 up 0.06 or 0.03%.

The $RUT is at 1126 up 4 or 0.36%.

NASDAQ is at 4355 up 2 or 0.05%.

NASDAQ 100 is at 3874 down 0.67 or -0.02%.

$VIX 'Fear Index' is at 16.37 down 0.50 or -2.96%. 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 negative and the current bias is sideways and flat.

How Oil Really Gets Priced

Crude oil prices fall to six-month lows on refinery outlook

WTI oil is trading between 98.12 (resistance) and 96.76 (support) today. The session bias is neutral and is currently trading down at 97.44.

Brent Crude is trading between 105.43 (resistance) and 104.55 (support) today. The session bias is negative with volatility spikes and is currently trading down at 104.88.

Gold rose from 1289.01 earlier to 1310.50 and is currently trading down at 1305.90. The current intra-session trend is elevated and sideways.

Dr. Copper is at 3.166 falling from 3.191 earlier.

The US dollar is trading between 81.77 and 81.46 and is currently trading down at 81.64, the bias is currently down, quiet with a negative slant.


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Written by Gary


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