Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
AI Tech Stocks State Going into the CRASH and Capitalising on the Metaverse - 25th Jan 22
Stock Market Relief Rally, Maybe? - 25th Jan 22
Why Gold’s Latest Rally Is Nothing to Get Excited About - 25th Jan 22
Gold Slides and Rebounds in 2022 - 25th Jan 22
Gold; a stellar picture - 25th Jan 22
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Weak Mid Day...Strong Late Day Action........

Stock-Markets / Stock Markets 2010 Apr 02, 2010 - 07:16 AM GMT

By: Jack_Steiman

Stock-Markets

This bull market is really something to behold. It is doing mind boggling things we just don't see very often. Not even in some of your best bull markets. It is staying overbought on the daily charts longer than I can believe. Add in the fact that there are now some small negative divergences on those daily charts and you have to wonder why it won't correct. The bull market is alive and well but we really need and should be getting some form of a pullback based on the look and nature of those daily charts across all the major indexes.


Today was interesting in that we saw this behavior once again. We took off out of the gates to the up side which created even deeper overbought conditions and even deeper negative divergences. You just had the feeling it would all collapse as the day went along and that reality did not disappoint when with just a few hours left in the day the market fell hard. The Nasdaq falling nearly forty points off its highs. It looked as if the whole market would go red and fall apart when it did what it always does these days. It turned around and shot back up. No deep selling although the Nasdaq did print a nasty black candle off a gap up after a long move higher in the pattern and these candlesticks usually but not always signal a near-term top. In this bull you can't count on it being dependable but it should theoretically be the top short-term only. A black candle means on balance sellers once the gap up takes place at the open. An up day but below the opening gap up. The bulls continue their happy dance but at least the bears have some hope short-term.

One interesting note to take from today's action was how badly the Nasdaq lagged the other indexes. This too is a red flag of sorts because when beta begins to lag that can often mean a run to more safe stocks with less volatility and risk. When risk goes away markets usually struggle. In this bull who knows because there's never any follow through but it is worth noting and should put the bulls on notice. it wasn't just that the Nasdaq lagged, it was how deeply it lagged. Big volume selling on technology stocks as the day wore on. The rest of the market closed well overall. Lots of nasty black candles on leading technology stocks such as Apple (Apple (AAPL), Google (GOOG) and others. We'll see Monday morning how this plays out but it does at least tell us to be very cautious near-term.

Commodity stocks are strong. We have been very fortunate to partake in some of these the past many days with big wins on those plays for sure. It's almost as if the market is telling us inflation is down the road, meaning a good economic recovery is at hand. No way to tell for sure if this is the message, but these stocks are being treated as if pricing power is upon them, as is demand. They clearly go hand in hand. Demand brings about inflation. These stocks are breaking out, and I don't think we'd be seeing this if the market wasn't telling us that an economic recovery we keep hearing about will actually take place. Most seem to doubt it, but the market seems to be saying otherwise for now.

The good news for the bulls is that the S&P 500 has now made a decent move away from 1151, the big breakout level. It's now nearly 35 above and that's good as it now allows for a decent pullback to occur without worrying too much about the S&P 500 giving that level up before buyers come back in. The 20-day exponential moving average is actually a few points above that 1151 level which adds an extra layer of strong support to this index. When important moving averages break above critical horizontal price support, this makes the job for the bears very difficult. 1151 alone would be tough support but add in the 20's and the battle just magnified quite a bit against the bears.

Friday the market is closed but we have the critical jobs report at 8:30 am eastern time. It will be reported on CNBC or Bloomberg. There is the expectation is for solid job growth. The ADP report on Wednesday put that growth in serious doubt. if the report is poor it is likely the market will have its catalyst to finally sell and unwind deeper than we have thus far. If the report is good it may sell some anyway but you never know with this bull market machine. A good report would put the selling in to question but you all know the truth by now which is if a market needs to sell it's going to no matter what comes out favorable. It will be very interesting for sure.

Happy Easter Sunday for those who celebrate.

Peace

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 21-Day Trial to SwingTradeOnline.com!

© 2010 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in