Best of the Week
Most Popular
1.Gold Price Crash Through Key Support, Crude Oil in Freefall - Clive_Maund
2.Marc Faber Warns Japan's Bond-Buying Program is a Ponzi Scheme - Bloomberg
3.Silver Price and Powerful Forces - DeviantInvestor
4.Stocks Bear Market Catastrophe as Stocks Flash Crash to New All Time Highs - Nadeem_Walayat
5.Marc Faber Warns Not to Hold Any Gold in the U.S. - GoldCore
6.U.S. Housing Market San Francisco at Critical Mass - Harry_Dent
7.Global Scramble For Silver - Coins “Hard To Get,” “Premiums Likely To Jump” - GoldCore
8.Major World Stock Market Indices Analysis: SPY, QQQ, DAX, FTSE, CAC, HSI - Michael_Noonan
9.Japan's kaput?! - Axel_Merk
10.Tesco Empire Strikes Back, £5 off £40 Discount Voucher Spend Explained, Exclusions Warning! - Nadeem_Walayat
Last 5 days
Crude Oil and Stock Market Setting The Stage For The Next Recession - 23rd Nov 14
This Publicly-Owned Bank Is Outperforming Wall Street - 23rd Nov 14
Who’s Ready For $30 Crude Oil Price? - 23rd Nov 14
Strategic, Methodological and Developmental Importance of Knowledge Consumption - 23rd Nov 14
Manipulated Stock Market Short Squeezes to Another All Time High - The China Syndrome - 23rd Nov 14
Gold Price 2015 - 22nd Nov 14
Stock Market Medium Term Top? - 22nd Nov 14
Is the Gold And Silver Golden Rule Broken? - 22nd Nov 14
Malaysia's Subsidy and Budget Deficit Conundrum - 22nd Nov 14
Investors Hated Gold at Precisely the Wrong Time: What About Now? - 22nd Nov 14
Gold and GLD ETF Selloff - 22nd Nov 14
Currency Wars, the Ruble and Keynes - 21st Nov 14
Stock Market Investor Sentiment in The Balance - 21st Nov 14
Two Biotech Stocks Set to Double on One Powerful Catalyst - 21st Nov 14
Swiss Gold Poll Likely Tighter Than Polls Suggest - 21st Nov 14
Gold's Volatility and Other Things to Watch - 21st Nov 14
Australia Stock Market and AUD Dollar Analysis (ASX200 and AUDUSD) - 21st Nov 14
New Algae Research May Have Uncovered an “Energy Forest” Under the Sea - 21st Nov 14
The Cultural and Political Consequences of Fiat Money - 20th Nov 14
United States Social Crisis - No One Told You When to Run, You Missed the Starting Gun! - 20th Nov 14
Euro-Zone Tooth Fairy Economics, Spain Needs to leave the Euro - 20th Nov 14
Ebola Threat Remains a Risk - New Deaths in Nebraska and New York - 20th Nov 14
Stock Market and the Jaws of Life or Death? - 20th Nov 14
Putin’s World: Why Russia’s Showdown with the West Will Worsen - 20th Nov 14
Making Money While The World Burns - 20th Nov 14
Why This "Quiet Zone" Is Now Tech Stocks Biggest Profit Sector - 20th Nov 14
My Favorite Stock McDonalds Just Got Kicked Off My “Buy” List - 19th Nov 14
European Economies in Perpetual State of Shock, What's Scarier Than Deflation? - 19th Nov 14
Breakfast with a Lord of War and Nuclear Weapons - 19th Nov 14
The U.S. Economy’s Ebb and Flow - 19th Nov 14
What You Need to Know Before Investing in Alibaba - 19th Nov 14
Forget About Crude Oil Price Testing 2009 Low - 19th Nov 14
What Blows Up First? Part 5: Shale Oil Junk Bonds - 19th Nov 14
Bitcoin Price Did We Just See an Important Slump? - 18th Nov 14
How to Profit From Oversold Crude Oil Price - 18th Nov 14
Stock Valuations Outrunning Profits Growth - And the Band Played On - 18th Nov 14
ECB Buy Gold Bullion? Japan's Monetary Policy Dubbed "Ponzi Scheme" - 18th Nov 14
Gold, Silver, Crude and S&P Ending Wedge Patterns - 18th Nov 14
How High Could USD/JPY Go? - 18th Nov 14
On Obama and the Nature of Failed Presidencies - 18th Nov 14
Globalism Free Trade Immigration Connection - 18th Nov 14
An Epiphany From Hell - Buy Gold and Silver - 18th Nov 14
Too Difficult to Get a U.S. Home Loan - 18th Nov 14
Has the Gold Bear Trap Been Set - 18th Nov 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Gold Report 2015

Stock Market Standing Still....

Stock-Markets / Stock Markets 2013 Feb 12, 2013 - 11:04 AM GMT

By: Sy_Harding

Stock-Markets

We're all waiting to some degree for this market to take the big spill lower. It will happen soon. It's only a matter of time before sentiment and the repeated overbought conditions catch up to the market. The problem for everyone, bulls and bears alike, is the reality of not being able to time this eventual plunge to unwind the sentiment issues currently at hand. We're not at extremes yet, so timing it is virtually impossible. If you've tried to do so from a bearish perspective you have had some rough times lately.


The bears have been fooled over and over again as they jumped in a first signs of overbought, especially when it got to extremes on many of those key index charts. And it did get to extremes when you think of how many daily RSI's got to over 80 on indexes such as the small and mid-caps. After some price unwinding, little price unwinding at that, which allowed the overbought conditions to go more neutral, here we are again trying for overbought, but this time also creating what will be negative divergences. At some point soon, as I mentioned above, the market is going to take a powerful hit.

However, knowing that's true, you have to stick with the trend in place until you get the proper reversal stick. If you want, you can sit on cash and wait for it, or you can keep some exposure, but be smart to avoid the super higher beta plays so as to not get hit too hard when the market sells a bit. There are many ways to go about adjusting to the times we're in, but the best way is to keep it light and to avoid the froth and high beta names for now. Whatever works for you is what you should do, but I'd be careful shorting too soon, especially if you want to get aggressive doing so. One up day can make the pain of too much shorting unbearable. Be wise. Go slow and adapt.

Markets find a way to hang in there when they're not ready to give up the trend in place. For instance, it's not able to break out in a given moment but will find an area to be bought in order to keep things moving higher or laterally. On the other hand, it'll also find places to sell so things don't get out of hand on the up side. We see buying in one area and selling in another. Today the buying was more in the world of financial stocks, while the selling took place in the retail space. There's always exceptions to both areas of the market, but most retail stocks struggles today while most financial stocks did just fine.

This is how the market cycle is about to keep the trend in place moving forward. With today's flat open, it didn't really provide the market technically with the type of candle sticks that say the uptrend is clearly over for the short-term at least. It may be, but there was no classic topping sticks. More of the buy one area and sell the other. No across the board selling with topping sticks we normally but not always see. The cycling hung in for yet another day so we have more watching to do so as to try and find a true topping stick that says we'll finally get the deeper selling the market pretty much desperately needs.

None of the classic events are taking place that signify the end of a bull market. Yes, a nasty sell off period is coming, but nothing thus far that suggests the bull market itself is in big trouble. Good news is still treated as good news. There is no massive selling volume at the tops of patterns once they sell off some. No massive negative divergences are in place.
In addition, the Fed is protecting with liquidity. Too many good things, especially the last thing mentioned with the Fed, to get bearish on the bigger picture at this time, so when this market finally snaps from overbought and sentiment, use that weakness over time to accumulate good plays. Find the best bases and patterns and play on weakness. Then use patience to reap the benefits of those set-ups on weakness. S&P 500 1494 is support all the way down to 1470. Moving averages, etc. We'll look for bottoming sticks when the selling kicks in.

For now, resistance up near 1525 is on deck for the bulls. Watch with patience and appropriateness. Keep it safe.

Peace,

Sy Harding is president of Asset Management Research Corp., and editor of the free market blog Street Smart Post.

© 2013 Copyright Sy Harding- All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Sy Harding Archive

© 2005-2014 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

Free Report - Financial Markets 2014