Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24
How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - 17th Feb 24
Why Rising Shipping Costs Won't Cause Inflation - 17th Feb 24
Intensive 6 Week Stock Market Elliott Wave Training Course - 17th Feb 24
INFLATION and the Stock Market Trend - 17th Feb 24
GameStop (GME): 88% Shellacking Yet No Lesson Learned - 17th Feb 24
Nick Millican Explains Real Estate Investment in a Changing World - 17th Feb 24
US Stock Market Addicted to Deficit Spending - 7th Feb 24
Stocks Bull Market Commands It All For Now - 7th Feb 24
Financial Markets Narrative Nonsense - 7th Feb 24
Gold Price Long-Term Outlook Could Not Look Better - 7th Feb 24
Stock Market QE4EVER - 7th Feb 24
Learn How to Accumulate and Distribute (Trim) Stock Positions to Maximise Profits - Investing 101 - 5th Feb 24
US Exponential Budget Deficit - 5th Feb 24
Gold Tipping Points That Investors Shouldn’t Miss - 5th Feb 24
Banking Crisis Quietly Brewing - 5th Feb 24
Stock Market Major Market lows by Calendar Month - 4th Feb 24
Gold Price’s Rally is Normal, but Is It Really Bullish? - 4th Feb 24
More Problems in US Regional Banking System: Where There's Fire There's Smoke - 4th Feb 24
New Hints of US Election Year Market Interventions & Turmoil - 4th Feb 24
Watch Consumer Spending to Know When the Fed Will Cut Interest Rates - 4th Feb 24
Blue Skies Ahead As Stock Market Is Expected To Continue Much Higher - 31st Jan 24
What the Stock Market "Fear Index" VIX May Be Signaling - 31st Jan 24
Stock Market Trend Forecast Review - 31st Jan 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Acting Better...

Stock-Markets / Stock Markets 2010 Sep 09, 2010 - 01:47 AM GMT

By: Jack_Steiman


I don't think anyone would argue with that reality. It's not great, and it's clearly not on breakout, but it is acting better even though the masses still think the action isn't worth playing. The economic news isn't great, and we sure do hear enough bearish talk day to day when watching the news station. The truth is, however, that the market is holding up extremely well despite the negativity. Of course, that's one of the main reasons it is holding up. Just too many bears at this point in time. More on that in a bit.

Bottom line here is the market is trying to ignore some short-term negative divergences and make the breakout above trend line at 1105. Let's call it 1105 and not 1110. You know markets are strong when you see very little in terms of downside action, even when things don't look great on the short-term charts. It may just be head down time for the market and that it will ignore the short-term bearish signals as the daily charts fully take control of the overall action.

With the market so close to major resistance at 1105, it's usually a gap up that makes huge resistance become support. It can happen without a gap, but a trend line such as this usually will need a gap up and out that traps the shorts. They have to cover once it gaps above, and the move up is on, whether there are some poor divergences short-term or not.

I am not sure what news is out there that can get us to gap up, but overseas charts aren't bad, and thus, it could happen simply with good action in China and Europe. Get our futures moving up, and get those shorts to get nervous and cover pre-market, pushing our futures above the resistance headache dead ahead. It could also be some statement from Fed Bernanke or President Obama. No way to know, but you get the feeling the market is anticipating something based on the current behavior it's showing.

Good to see those banks get a bid today, and even more importantly, after gapping down on downgrades, the semis did come back late in the day. On top of that, the daily chart on the Semiconductor HOLDRs (SMH) or ETF of those semis, is showing some positive divergences at the bottom. That gives them hope that a turn around is coming even though it feels like that's never going to happen.
It's understandable sentiment there is really poor, but that's probably going to be the catalyst to get them going higher when everyone thinks death is near. If the banks start to participate, and the semis can catch on their divergences, we could see the move take place in short order above S&P 500 1105. No guarantee as they've lagged, but there is some hope technically.

The sentiment figures came in, and although it added some bullish action, the overall picture remains far more bearish in terms of emotions. Only a 1.1% spread of more bulls to bears. 33.3% to 32.2%. These types of figures have historically kept markets from falling too hard for too long. Never a guarantee as they can get inverted by 205 at times in the very worst of situations, but for now you have to like, if you're a bit more bullish, that the sentiment is decidedly bearish in nature. A real plus for the bulls.

If we can take out S&P 500 1105, there really isn't much until we get to S&P 500 1131, where there's the next wall to climb. Good support comes in at 1085 up to 1093. We take things one step at a time, of course, but the overall action is more bullish these days as we trade just under the trend line breakout at 1105.



Jack Steiman is author of ( ). Former columnist for, 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!

© 2010

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 constitutinginvestment advice. Trades mentioned on the site are hypothetical, not actual, positions.

© 2005-2022 - 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