Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Poor ISM...Poor Advance Decline Line.....

Stock-Markets / Stock Markets 2013 Apr 01, 2013 - 07:44 PM GMT

By: Jack_Steiman

Stock-Markets

The market, as usual, refused to fall overnight no matter what else was going around the world. Our futures are refusing to follow others down. Ours is the market that just won't fall. The market opened flat and started moving higher as always until it ran into a real road block. The ISM Manufacturing Report came out and the number was just terrible. 51.2. 50.0 is the line between growth and recession for our economy. Think about this folks. Mr. Bernanke has implemented incredible liquidity. There have been basically 3 QE programs. Interest rates are near zero and staying there. The liquidity machine will remain on as well. All because nothing is working to get this economy flying higher. Not even a Disneyland bull market can get this economy rocking.


Fed Bernanke keeps trying, but nothing is happening on a positive level. They report employment is improving, but really, it's not as they don't report those who have given up looking. Our Government just doesn't believe in telling the truth for fear of what would happen in the stock market and how the public would perceive them. So the lies keep getting reported, and in the end, nothing is really getting better even though they're telling you they are. The bad ISM Report this time couldn't keep traders from taking froth down as the Nasdaq was hit much harder to the down side than the Dow or S&P 500. The Dow basically ended flat, but the S&P 500 was down a bit more and then it got worse as the froth areas came in. The small caps and technology stocks are taking the biggest hits. In the end nothing is bad at all as the bears didn't really seize on the bad news, but they were at least able to take some of the froth out of this market for a day.

So when do you take notice of something that is different than what we're used to seeing? When an index is basically flat yet the advance decline line is very poor. We saw nearly two to one negative on the Nasdaq and quite negative on the New York Stock Exchange. Apple Inc. (AAPL) continues to break down with many areas of the market now in bear markets. The commodity sector is one. Leaders such as Joy Global, Inc. (JOY), Agrium Inc. (AGU), CF Industries Holdings, Inc. (CF), Caterpillar Inc. (CAT), Deere & Company (DE), Cummins Inc. (CMI), and boat loads of other leaders just aren't performing well. Even Goldman Sachs Inc. (GS) broke down below the 50-day exponential moving average today. Amazon Inc. (AMZN) joining in. Fewer and fewer stocks are now participating in this move higher and that's a red flag if ever there was one. Forget the overbought conditions, which is enough to take a market down. Add in fewer and fewer stocks performing well and trading over their 50-day exponential moving averages and you have potential trouble in the near future. Hard to say as we know when things could get ugly but you have to recognize trouble when it looks you in the eye and we're seeing more and more red flags appear. So please adjust accordingly.

The one thing that is starting to stand out even more as we grind higher is the MACD's on those daily charts. They are looking worse by the day. The negative divergences in many cases are quite powerful and extending out. We still have mostly overbought weekly and monthly charts to go along with those negative divergences on the daily charts. We have fewer stocks participating. I don't know what to say folks, but the risk reward isn't exactly spectacular for the bulls right now. In a bull run it's truly impossible to know when things start to go south. However, one good hint would be a strong gap down that doesn't reverse as all the others have. That and then a second straight gap down that doesn't come back. When we see this set up take place the up-trend is over for several seeks to several months. It doesn't mean it's over for good because it won't be. As long as we have Disneyland Ben the market will continue to try for higher levels over time. The market would be best served with some deeper selling first and, thus, we can hope that it's around the corner but as of yet we haven't seen it.

Keep it light.

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 15-Day Trial to SwingTradeOnline.com!

© 2013 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.


© 2005-2022 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