Best of the Week
Most Popular
1.Dow Stock Market Trend Forecast 2015 by Nadeem Walayat - Nadeem_Walayat
2.Gold And Silver – Forget The News. Silver $12 – 14? Gold $1,000 – 1,100? 5 - Michael_Noonan
3.A TOP Formation In Apple Inc. - Crash Condition Signal Recorded - David Harris
4.Gold Gets Safe Haven Bids But COMEX Has Stopping Power - GoldSilverWorlds
5.The Swiss 10-Year Bond Illustrates Central Banks` Flawed Monetary Policy - EconMatters
6.Exponential Explosions in Debt, the S&P, Crude Oil, Silver and Consumer Prices - DeviantInvestor
7.“Forgive Us Our Debts” – Only Way To Prevent Economic Meltdown - GoldCore
8.Is Russia Planning a Gold-Based Currency? - Marcia Christoff-Kurapovna
9.Stock Market Trend Forecast 2015 Video - Nadeem_Walayat
10.Gold GDX ETF Technical Analysis - Austin_Galt
Last 5 days
Varoufakis vs. the Troika - Showdown in Athens - 1st Mar 15
Subprime Rising - U.S. Debt Breaking Bad Part 2 - 1st Mar 15
Gold CoT Improving, But ... - 1st Mar 15
UK General Election 2015 Seats Forecast - Who Will Win? - 28th Feb 15
UK General Election 2015 - Forecasting Seats for SNP, LIb-Dems, UKIP and Others - 28th Feb 15
Stocks Bull Market Continues - 28th Feb 15
U.S. Debt Breaking Bad - 28th Feb 15
NATO Frankenstein - When Centralization Scales Beyond Our Control - 28th Feb 15
Gold And Silver Insanity Prevails; Precious Metals Without Direction - 28th Feb 15
Fed Raising U.S. Interest Rates - Shovelin’ Schmitt Against the Tide - 28th Feb 15
Don't Let This Stock Market Myth Cost You Your Gains - 28th Feb 15
Recession is On The Way; Beat The Stock Market Crowd, Panic Now! - 28th Feb 15
Stock Market Indexes Creeping Towards the Edge - 28th Feb 15
GGD Going for Mexican Gold - 27th Feb 15
Foreign Real Estate Is the New Swiss Bank Account - 27th Feb 15
10 Reasons Washington Has War Fever - 27th Feb 15
Gold and the Euro Tragedy, Iraq 3.0, Ukraine Conflict Three Ring Circus - 27th Feb 15
Deepak Chopra - New Age Genius or Bullshit Expert? - Video - 27th Feb 15 - Videos
New Greece Drachma Revealed Amid Bank Runs - Greeks Buy Gold Sovereigns - 27th Feb 15
Will Month Long Stocks Rally Continue? - 27th Feb 15
The Only Public Hedge Fund You Should Own - 27th Feb 15
UK House Prices Trend 2015 and the May General Election - 27th Feb 15
Why America is Ungovernable - The Republicans’ Civil War - 27th Feb 15
Gold vs Gold Stocks: Bullish Anomaly Developing? - 27th Feb 15
I Heart Capitalism, Nasdaq Stocks, Then And Now - 27th Feb 15
The Fed’s History of Assassination - 27th Feb 15 i
Gold Bull Market Forecast - Money Will Rotate Into These Dead Investments - 27th Feb 15
"Audit the Fed"? We've Already Done That (Well, Kind of) - 26th Feb 15
Forget Peak Oil; Worry About Peak Demand - 26th Feb 15
Currency Wars, Again - 26th Feb 15
The Fed Waited Too Long: Here Comes Inflation - 26th Feb 15
Investing Inertia Won’t Keep Your Cash Safe - 26th Feb 15
The Net Neutrality Scam - 26th Feb 15
Will Conservatives Out of Control Immigration Crisis Boost UKIP Election 2015 Prospects? - 26th Feb 15
EU Warns Ireland and Euro Zone of Debt Dangers - 26th Feb 15
Commodity Prices Set To Plunge Below 2008 Lows - 26th Feb 15
Ukraine Hyperinflation as Currency Plunges 44% in One Week! - 26th Feb 15
The State of the Global Markets 2015 - 53 Page Report - 26th Feb 15
NASDAQ New 15 Year High - Stock Market Death By Overdose - 25th Feb 15
12 Reasons Why Barry Ritholtz and Many UK Experts Are Mistaken On Gold - 25th Feb 15
Sugar Commodity Price To Sweeten Up - 25th Feb 15
Investor Profits from China 2,000-Year Unstoppable Trends - 25th Feb 15
How to Borrow Cheaply from a Government-Owned Bank - 25th Feb 15
Debt Be Not Proud - 25th Feb 15
Liberal Democrat Election Blood Bath - Could Nick Clegg Lose Sheffield Hallam? - 25th Feb 15
Wheat Commodity Price Technical Trend Forecast - 24th Feb 15
Bitcoin Price Might Stay below $250 - 24th Feb 15
Another Important Stock Market Inflection Point Approaching - 24th Feb 15
Gold: The Good, Bad, and Truly Ugly - 24th Feb 15
Eurozone Gold Holdings Increase to 10,792 Tonnes As “Reserve of Safety” Amidst Crisis - 24th Feb 15
Bird Doo; Yellen Goes to Congress - 24th Feb 15
Is Gold Investing Risk Free? - 24th Feb 15
The Bull Case For Gold Price 2015, and the Bear - 24th Feb 15
Europe - The Intersection of Three Crises - 24th Feb 15
Gold Price Just Needs More Time - 24th Feb 15
Gold Price Downtrend Looks Set to Continue - 23rd Feb
Silver Price Depressing Downtrend Will Eventually End - 23rd Feb 15
5 Reasons Why You Should Sell Amazon Stock - 23rd Feb 15
Global System Catastrophe Is Key Threat To Human Civilisation - 23rd Feb 15
Greece Crisis Yields Ideal Market Opportunities - 23rd Feb 15
Gold and Silver Stocks or General Stock Market Indices? - 23rd Feb 15
Swimming With Sharks: Goldman Sachs, Schools and Capital Appreciation Bonds - 23rd Feb 15
Stock Market - The Fed Still Has Your Back - 23rd Feb 15
Soybean Commodity Price Technical Outlook - 23rd Feb 15
Gold Weekly COTs and More - 23rd Feb 15
Stock Market New Highs With Weak Breadth - 23rd Feb 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

The State of the Global Markets 2015

Some Selling Off The Stock Market Top...More To Come?.....

Stock-Markets / Stock Markets 2013 Feb 24, 2013 - 12:44 PM GMT

By: Sy_Harding

Stock-Markets

That's the big question. Was the two-day selloff all the bears will be able to get, or will it be the beginning of deeper selling to come as the index charts unwind further off the 70-RSI tests on both the daily and weekly charts. We will have our answers soon enough. Early next week should be telling about whether we gap over gap resistance or whether the gaps just above act as a wall, thus, starting the market down on the next leg of selling. From a purely technical perspective, it would make more sense to start the next leg down as the gap down was on heavy volume, and today's buying was on much lighter volume. Gaps are very tough to take back, especially on the first try, and with both the daily and weekly charts having reached overbought, it should be tougher to make a strong move back higher.


Anything goes once you're in a bull market, which we are, so it shouldn't come as a total surprise if we make one more move higher and create a deeper negative divergence to take us down. It's possible we can test 1530 again without falling first, but if we do, the oscillators will be quite negative. It would be best if we sold harder once again and allowed things to unwind, but we can't control the markets. This week saw the first snap down we've seen in quite some time, the Nasdaq falling 95 points from its high on Tuesday to its lows on Thursday. We retraced some of that move today, of course. It will be a big week next week as we see what the bears can do, or not. They shouldn't allow the Nasdaq to close above 3163, if they're serious about making some noise for the short-term.

Bull markets become repetitive for traders. They chase up any time there's even a hint of selling as they're always looking for an entry into plays they like to follow. High beta names for the most part. This is why even pullbacks can be difficult to sustain, at least at the very beginning of them. The trained behavior comes in and gobbles up what they've seen work over and over. At some point, it burns them, but until it stops working, they chase. If you want down side action, and you're a bull, you need patience. I feel strongly that, for now, the bull market is on, regardless of how strong the pullback becomes. The Fed has made it clear that they will not pull the plug on low interest rates.

More importantly, they have no intentions of pulling the liquidity plug either. The bulls know this, and so do the bears, and that's why sustainable downside action is very difficult bigger picture for the bears right now. They need a Fed who will allow the market to fall hard. But right now it's just not in the cards. So with everyone on board with their actions, the wash, rinse and repeat cycle is ongoing, pullback or not.

The one ongoing bear market continues to be commodity land, especially in the world of coal, gold and silver. There are others, but those are the key ones we all watch. Even with many of these metals extremely oversold on their daily charts, they are having a hard time getting any sustainable rally. They should rally a bit from here, but be aware of the type of market they're in and adjust accordingly. Many have stated the worst was over a year ago, but it just keeps stair-stepping their way lower. No sign of that changing. The fear bubble is bursting.

Chasing weakness is often a good thing but it's not good when you are chasing the falling knife. A bear market is just that, and thus, know when to step aside. Focus your energy where things are working. Good longer-term mature bases or stocks pulling back to support with the 20-day EMA higher than the 50-day EMA. Look for healthy stocks over weak ones and you'll likely have a better experience.

Deeper, longer-term support on the S&P 500 is at 1470 to 1480. That, I believe, may still be tested before we try much higher again, although today was quite strong, stronger than usual on a reflex bounce. That said, it could get tested, but if it does, it would provide a strong buying opportunity. S&P 500 1530 is resistance, and if that clears, it can see the 1550 level before trying lower again. We will get more insight on that very soon. Don't be shocked if we sell next week, but be open to both sides of the coin. If the Nasdaq clears 3163 on a closing basis, the buying is on again and the bigger pullback will have to wait.

Next week will be an interesting week.

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

© 2005-2015 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