Market Commentary: Small Cap Up 1%, DOW up Triple Digits, Markets Look Frail

Written by Gary

Midday Market Commentary For 04-14-2014

As suspected the averages turned around from the morning lows and started melting back upwards, but not so high as to make us rush out and buy with abandon. The red flags of caution still wave briskly in the market winds.

By noon the averages, SP500 in particular, had risen back up above the 100 DMA, but on low volume concerning investors of the strength and bullish validity of today’s ‘recovery’.

The markets look so weak and frail today and I believe anything could trip Mr. Market and send him tumbling.

StockTiming.com

After listening to the media, many still think that the stock market is positive and doing well.

Today’s two charts show the reality of how 5 mainstream indexes have done since December 31, 2013, and as of their March 2014 highs.

The short 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, only a 6% correction (and recovery) and that is not enough for me to start shorting. The MACD has turned down slightly, but remains above zero. I would advise caution in taking any position during this volatile transition period although Barchart.com shows a 56 % sell. (Remember this has been negative for weeks.)

It is looking more and more like an ordinary correction and we will probably will see the major downturn later in 2014 after investor realize there isn’t going to be a real recovery with inflation and interest rates easing up anyway.

While not necessarily predicting a waterfall, jaw dropping market decent I don’t think the market can avoid at least a 20%, from peak, correction tied into the end of the Fed QE tapering. The real decent could come before or after the QE ending, either way, it should occur by the end of 2014

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The DOW at 12:00 is at 16141 up 113 or 0.70%.

The SP500 is at 1830 up 15 or 0.81%.

SPY is at 182.92 up 1 or 0.78%.

The $RUT is at 1122 up 10 or 0.93%.

NASDAQ is at 4039 up 39 or 0.98%.

NASDAQ 100 is at 3484 up 37 or 1.08%.

$VIX ‘Fear Index’ is at 16.47 down 0.57 or -3.35%. Bearish Movement

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

The longer trend is up, the past months trend is sideways, the past 5 sessions have been negative and the current bias is elevated, but sideways.

How Oil Really Gets Priced

WTI oil is trading between 104.55 (resistance) and 103.38 (support) today. The session bias is positive and trading sideways and is currently trading down at 103.92.

Brent Crude is trading between 108.42 (resistance) and 107.30 (support) today. The session bias is positive and is currently trading up at 108.24.

Gold rose from 1319.20 earlier to 1331.31 and is currently trading down at 1327.50. The current intra-session trend is sideways and volatile.

Analysts forecast a corrosive year for copper prices

Dr. Copper is at 3.048 falling from 3.061 earlier.

The US dollar is trading between 79.1 and 79.62 and is currently trading up at 79.79, the bias is currently sideways.

Real Time Market Numbers

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Written by Gary