Written by Gary
Closing Market Commentary For 09-23-2014
Markets slowly melted down over the afternoon session and began to sell-off 15 prior to the close with only low red volume.
By 4 pm everything was in the red including the DOW being off triple digits and the $RUT off one percent. I was expecting the markets to have started off down and stay there, which they did not until the session end. What is for tomorrow?
Normally these down session fall 3 to 4 percent and then rise back up again, but today's 'action' was a bit concerning in that 'normal' market movement was not followed. The markets could actually go either way, because the technical side of things is a go for further upside and short term indicators are definitely bearish.
The medium term indicators are leaning towards the hold side at the close and the short-term market direction meter is fractionally bullish. We remain mostly, at best, neutral and conservatively holding. The important DMA's, volume and a host of other studies have not turned significantly and that is not enough for me to start shorting, but now I am getting very concerned. The SP500 MACD has turned flat, but remains above zero at +5.84. I would advise caution in taking any position during this uncertain period although some technical indicators have starting to turn bearish.
Investing.com members' sentiments are 74 % Bearish and it seems to be a good sign for being bullish. The 'Sheeples' always seem to get it wrong.
StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 25.35. (Chart Here) Treasury Yield Curve Approaches Flattest Since 2009.
StockChart.com Overbought / Oversold Index ($NYMO) is at -58.23. (Chart Here) But anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold.
Chris Ciovacco says, "As long as the consumer discretionary ETF (NYSEARCA:XLY) holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy." This chart clearly shows that dropping below 65.50 should be of a great concern to bullish investors. Wednesday, 9-3-2014, XLY edged up to 69.25 and was a signal that we might have another reversal as were are witnessing.
The DOW at 4:00 is at 17056 down 117 or -0.68%.
The SP500 is at 1983 down 12 or -0.58%.
SPY is at 197.73 down 1.14 or -0.57%.
The $RUT is at 1119 down 11 or -0.94%.
NASDAQ is at 4509 down 19 or 0.42%.
NASDAQ 100 is at 5052 down 10 or 0.24%.
$VIX 'Fear Index' is at 14.93 up 1.24 or 9.06%. Neutral to Bearish Movement
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The longer trend is up, the past months trend is net positive, the past 5 sessions have been neutral and the current bias is negative.
WTI oil is trading between 992.04 (resistance) and 90.78 (support) today. The session bias is very volatile and trending up and is currently trading down at 91.44. (Chart Here)
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The general consensus is that gold prices will actually fall in the next twelve months (Sept to Aug. 2015). Goldman Sachs estimates that gold will fall to $1,050 an ounce, a drop of nearly 19%.
Gold fell from 1235.62 earlier to 1220.28 and is currently trading up at 1223.80. The current intra-session trend is sideways. (Chart Here)
Dr. Copper is at 3.034 falling from 3.064 earlier. (Chart Here)
The US dollar is trading between 84.87 and 84.46 and is currently trading up at 84.78, the bias is currently elevated and sideways. (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
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Written by Gary