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
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 Late Selling..... Not Anything Terrible

Stock-Markets / Stock Markets 2013 Nov 19, 2013 - 10:26 AM GMT

By: Jack_Steiman


It wasn't anything terrible, but it did come from some nasty looking MACD's on those daily-index charts. When studying them we see that they are making lower highs on the MACD's while printing higher highs in price. The small-cap stocks and Nasdaq look particularly poor, although with this market who knows if they'll ever play out, but you can't like what you see when looking at those charts. Add in the poor readings on sentiment and the combination, one would think, would bring about a fairly reasonable pullback, but who knows for sure. The market has been so strong it's hard to bet against it but you need to be safe when things show themselves and with today's reversals it seemed appropriate to raise some cash.

Certainly this is NOT the time to be overly aggressive to the long side, even though it seems the market can't fall. It's when it feels that way that it often happens but again, who knows. Just recognizing higher-risk moments are very important to your trading for the short-term. Because we're in a bull market you don't want to get overly aggressive to the short side either. We know how that's worked out for those who have been trying that trade. The market is likely saying it could use a little rest. Maybe it won't, but I have to say today's late action suggests to take it slow and easy time with longs and shorts. Lots of cash would not be a bad thing at all.

On Wednesday's, and sometimes late on Tuesday's, I can get those bull-bear market-spread results. We had a solid up-week last week after three weeks of basing. Before the week began we had a reading of 37.1% bulls to bears, bears at a very scary reading of 15%. That's historically extremely low. Did it move down to 13 or 14%? That would be unprecedented. Are the bulls rocking up towards 60%? Is the spread at or over 40%? All of these are critical for this market and, thus, I can't wait to get those numbers. At 40% on the spread it is a sell signal, but we have seen readings get in to the low 40's in the past, but rarely, if ever, seen bears at only 15% and now possibly even lower than that.

The rubber band is stretched folks. The market could use some selling just to unwind those longer-term weekly and monthly charts, let alone the daily charts, which would work off those poor divergences in place. Getting new plays with potential bad divergences and bad sentiment numbers isn't smart so for all our sakes, maybe we can get silly numbers on the spread that'll take the market down some and allow things to unwind, which would be very healthy. We'll know late tomorrow or on Wednesday. Stay tuned.

The breakout at 1775 is now strong support followed all the way down over time to 1730. Truth be told, as long as 1730 holds we're in good shape. If we ever lost 1730 then we'd likely be headed for a very serious correction. That is always possible even though it feels impossible. When markets go higher, and rarely correct, it feels as if it never will, but we all know how fast things can turn. In the past, when things got very stretched, I can promise you, it felt that way. No way we can fall, and then it gets hammered out of nowhere and doesn't come back.

I'm not saying that's what's on deck here, but just watch support levels and see where this all goes. The bigger correction may not come for many months. Who knows, but the risk is out there thus we watch key support levels. 1775 is first up on the S&P 500. Let's see if the bears can even get that to happen.



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 15-Day Trial to!

© 2013

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 - 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