Market Commentary: DOW Off 300 Points, 50 DMA’s Crossed And Supports Broken

Written by Gary

Closing Market Commentary For 07-31-2014

Markets closed the session on a low note with red volume shooting up to high marks and the $VIX eased up to the 17’s being more of a concern to investors than the hardened bulls.

By 4 pm supports of just about every average was broken and stopping short of plunging through the next one below that. The bad news is that we could see more red.

However, the good news is that this marginal correction is a short lived one and we may see the ‘Bull God’ look down upon us once more tomorrow after testing the next support of course. Now the jobs report in the morning could through a wrench into the works and send the markets further down. Don’t you just love this casino market?

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 2.82. I would advise caution in taking any position during this uncertain period.

Investing.com members’ sentiments are 55 % bearish and Investors Intelligence sets the breath at 65.7 % bullish with the status at Bear Correction. (Chart Here )

StockChart.com NYSE Bullish Percent Index ($BPNYA) is at 66.53. (Chart Here)

StockChart.com S&P 500 Bullish Percent Index ($BPSPX) is at 76.40. (Chart Here)

The Market Is Overpriced But The Correction Will Likely Be Shallow

StockChart.com Overbought / Oversold Index ($NYMO) is at -52.27. (Chart Here) (Need to type in $NYMO)

StockChart.com Consumer Discretionary ETF (XLY) is at 65.91. (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 would be of a great concern to bullish investors.

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

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The DOW at 4:00 is at 16564 down 317 or -1.88%.

The SP500 is at 1931 down 39 or -2.00%.

SPY is at 192.98 down 4 or -1.97%.

The $RUT is at 1120 down 27 or -2.31%.

NASDAQ is at 4370 down 93 or -2.09%.

NASDAQ 100 is at 3892 down 84 or -2.10%.

$VIX ‘Fear Index’ is at 17.09 up 3.76 or 28.21%. 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 negative and the current bias is negative.

How Oil Really Gets Priced

WTI oil is trading between 100.37 (resistance) and 97.89 (support) today. The session bias is depressed, volatile and is currently trading down at 98.02.

Brent Crude is trading between 106.81 (resistance) and 105.46 (support) today. The session bias is down, volatile and is currently trading down at 105.80.

Gold fell from 1298.61 earlier to 1282.35 and is currently trading up at 1284.00. The current intra-session trend is negative and volatile.

Dr. Copper is at 3.231 falling from 3.257 earlier.

The US dollar is trading between 81.66 and 81.42 and is currently trading down at 81.54, the bias is currently neutral and volatile.

Real Time Market Numbers

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Written by Gary