Market Commentary: Averages Remain Down Fractional Trend Upwards

August 28th, 2014
in Gary's blogging, midday post

by Gary

Midday Market Commentary For 08-28-2014

Today's session is somewhat like watching grass grow. Volume has turned anemic, HFT algo computers are pushing the averages up and there is no telling what the shady Wall Street crooks are up to.

By noon the bulls have given up on seeing a positive session as the averages have run out of financial gas and appear to be rolling over.

Follow up:

Market pundits are blaming today's market weakness on the Russian / Ukraine situation.

Worsening tensions in Ukraine send stock indexes lower; Williams-Sonoma, other retailers sink

Worsening tensions in Ukraine are sending stock indexes lower, overshadowing an encouraging report on U.S. economic growth. Ukraine's president said Russian forces have entered his country.

He called an emergency meeting of his nation's security council. Several retailers fell after releasing results or outlooks that disappointed investors. Williams-Sonoma plunged 11 percent and Abercrombie & Fitch fell 5 percent.

The Dow Jones industrial average fell 51 points, or 0.3 percent, to 17,071 as of noon Eastern time Thursday. The Dow is coming off three days of gains. The Standard & Poor's 500 index fell four points, or 0.2 percent, to 1,995.

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, but now I am very concerned. The SP500 MACD has turned up, but remains above zero at 12.10. I would advise caution in taking any position during this uncertain period although some technical indicators have starting to turn bearish. members' sentiments are 55 % 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 60.7 % bullish with the status at Bear Confirmed. (Chart Here ) NYSE Bullish Percent Index ($BPNYA) is at 64.96. (Chart Here) Very close to resistance now and rising. S&P 500 Bullish Percent Index ($BPSPX) is at 76.00. (Chart Here) Remains below support, now resistance. 10 Year Treasury Note Yield Index ($TNX) is at 23.40. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009. Overbought / Oversold Index ($NYMO) is at 42.71. (Chart Here) (Need to type in $NYMO) It is now around the area where it turns and starts to descend, but any thing below -30 / -40 is a concern. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. Wednesday, 8-20-2014, $NYMO climbed to 58.24 is signaling a market reversal in our near future. Consumer Discretionary ETF (XLY) is at 68.77. (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. This chart clearly shows that dropping below 65.50 should be of a great concern to bullish investors. Wednesday, 8-27-2014, XLY edged up to 69.03 and that is another notch in the gun signaling that we might have another reversal very soon - at least to cover the gap below. Protect thyself!

The DOW at 12:15 is at 17069 down 53 or -0.31%.

The SP500 is at 1996 down 4 or -0.20%.

SPY is at 200.00 down 0.25 or -0.12%.

The $RUT is at 1168 down 5 or -0.42%.

NASDAQ is at 4560 down 9 or -0.20%.

NASDAQ 100 is at 4066 down 6 or -0.16%.

$VIX 'Fear Index' is at 12.21 up 0.43 or 3.65%. Neutral Movement

(Follow Real Time Market Averages at end of this article)

The longer trend is up, the past months trend is net positive, the past 5 sessions have been net positive and the current bias is down, but trending up.

How Oil Really Gets Priced

WTI oil is trading between 94.69 (resistance) and 93.45 (support) today. The session bias is positive and is currently trading down at 94.24. (Chart Here) There is a very large gap at 97.06 and these types of gaps are usually filled sooner rather than later. It would not surprise me to see the oils move back up in the very near future. (Chart Here) (Look at the 60 minute time scale.)

Brent Crude is trading between 103.19 (resistance) and 102.28 (support) today. The session bias is neutral, descending trend and is currently trading down at 102.39. (Chart Here)

Why Gold Will Rise When The Dollar Falls

Gold rose from 1286.28 earlier to 1297.39 and is currently trading up at 1291.30. The current intra-session trend is neutral. (Chart Here)

Dr. Copper is at 3.152 falling from 3.204 earlier. (Chart Here)

The US dollar is trading between 82.62 and 82.34 and is currently trading down at 82.55, the bias is currently positive. (Chart Here)


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

"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation inequities, they should try to be fearful when others are greedy and greedy only when others are fearful." - Warren Buffett

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.

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Written by Gary


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