Best of the Week
Most Popular
1.A 'Wicked Rally' in Gold Price Predicted - The_Gold_Report
2.Gold and Silver Bullion Buying Opportunity for 2017? - Nadeem_Walayat
3.The Coming Stock Market Crash and WWIII - Brad_Gudgeon
4.First UK BrExit then Trump, Next BrExit Tsunami Wave to Hit Italy HARD Sunday! - Nadeem_Walayat
5.Trump Sets The Stage For A Huge Gold Rally In 2017 - James Burgess
6.Why We Haven’t Seen Gold Price Rally after Trump Victory - Harry_Dent
7.Silver Bullion Price Buying Opportunity for 2017? - Nadeem_Walayat
8.Trump Stocks Bull Market Furious Rally Towards Dow 20k as Bear Mantra Persists - Nadeem_Walayat
9.Gold Bullion Price Buying Opportunity for 2017? - Nadeem_Walayat
10.Trump's Presidency - Stock Market Crash or Start of New Mega-Trends - Sol_Palha
Last 7 days
Official Warning: Stocks Are Going to Crash - 10th Dec 16
CIA Warns Donald Trump is Putin's Manchurian Candidate! - 10th Dec 16
Gold Fools, US Dollar Bulls and The Long Term Outlook for Both Markets - 10th Dec 16
Stock Market Saeculum 1st Turning Underway - 10th Dec 16
India's Stock Market: Nothing "Random" About It - 9th Dec 16
Gold Futures Selling Exhausting - 9th Dec 16
Cheap Large Icicle Christmas LED Lights Review - B&M Stores - 9th Dec 16
US Interest Rates and the Toughest Man Who Ever Lived - 9th Dec 16
Amazon UK Christmas Shopping Useless Delivery Tracking Warning Alert - 9th Dec 16
Euro-zone Crisis - The Soon To Erupt Euro Experiment - 9th Dec 16
Global Market Perspective 3 Killer Charts, 2 Fast Looks at Politics - 9th Dec 16
Trump Could Fuel A Nuclear Energy Boom In 2017 - 8th Dec 16
Our Future Economy, Jobs, Banking, And Governance – Part2 - 8th Dec 16
Developing Knowledge-Intensive Society and Knowledge Industrial Hub in Kerala - 8th Dec 16
Crude Oil and Gold, Silver Precious Metals Link - 8th Dec 16
Stock Market and the Great Middle Class Revolt Gets Bigger - 8th Dec 16
Protectionist Trump Policies To Crash Dollar, Gold and Bitcoin to Soar - 8th Dec 16
The Jaws of Life : The Most Hated Stocks Bull Market in History! - 8th Dec 16
Infrastructure A Budding Asset Class - 8th Dec 16
Trump Stocks Bull Market Furious Rally Towards Dow 20k as Bear Mantra Persists - 8th Dec 16
More Talk About More Economic Growth and More Globalization - 7th Dec 16
Cracks In US Treasury Bond Market, The Japanese Factor - 7th Dec 16
The Rise of Anti-Establishment Italy - 7th Dec 16
Trump Likely to Drive Another Bump in Stock Market Buybacks — Here’s How to Hedge - 7th Dec 16
World War II and the Origins of American Unease - 7th Dec 16
Online CFD Trading for Traders on a Budget - 7th Dec 16
Silver Bullion Price Buying Opportunity for 2017? - 7th Dec 16
The Imminent Multi-Trillion Dollar Surge In Social Security & Medicare Costs - 7th Dec 16
Gold Bullion Price Buying Opportunity for 2017? - 6th Dec 16
Shariah Gold Standard Approved for $2 Trillion Islamic Finance Market - 6th Dec 16
THE Gold Play for 2017 - 6th Dec 16
Trump Sets The Stage For A Huge Gold Rally In 2017 - 6th Dec 16
BrExit Tsunami Claims Emperor Renzi's Scalp, Counting Down to End of the EU, Next? - 6th Dec 16
Failed EU - Means an Expanded Dictatorship - 6th Dec 16
Crude Oil Prices: "Random"? Hardly - 5th Dec 16
The Coming Stock Market Crash and WWIII - 5th Dec 16
This Past Week in Gold Market - 5th Dec 16
Stock Market Short-Term Correction Underway - 5th Dec 16
If Trump Doesn’t Do This, We Will Have the Great Depression 2.0 - 5th Dec 16
India’s Demonetization Could Be the First Cash Domino to Fall - 5th Dec 16
Our Future Economy, Jobs, Banking, And Governance - 5th Dec 16
Gold and Silver Bullion Buying Opportunity for 2017? - 4th Dec 16
First UK BrExit then Trump, Next BrExit Tsunami Wave to Hit Italy HARD Sunday! - 3rd Dec 16
The 10YR Yield and SPX Stocks Bull Markets - 3rd Dec 16
Gold And Silver – Do Not Expect Much Difference With Trump Compared To Obama - 3rd Dec 16
Gold, Currencies and Markets Critical 61.8% Retracements - 2nd Dec 16
Gold Junior Stocks Q3’16 Fundamentals - 2nd Dec 16
Adventures in Castro’s Cuba - 2nd Dec 16
We Are Putting Off the Inevitable - 2nd Dec 16
Macroeconomic Cycles & Demographics - A Fuse, An Explosive and The Igniting Catalyst - 2nd Dec 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

$10000 Gold

Stock Market Back Testing...Now What....

Stock-Markets / Stock Markets 2014 Feb 09, 2014 - 10:21 AM GMT

By: Jack_Steiman

Stock-Markets

The market fell quite a bit from the first day of January and kept going pretty much until midweek this week. The market oscillators got very compressed lower, while the Dow was testing its 200-day exponential moving average. It told me that the market should be done selling for a while, and that a rally should take place, thus, the Spy long that was taken. The real question is once we tested the 20- and 50-day exponential moving averages from underneath, something that basically occurred today, would the market just quit, or would it surprise, take them out and go higher?


We don't know if they'll be taken out with force, but it was solid action today to be sure. We'll get our answer next week on the take out, or not, but we also got slightly overbought today on the short-term charts. On top of that, we got a strong gap up today that wasn't filled, thus, the bulls have added some strength to the technicals, which were very against them coming in to today's action. That has changed to more neutral now. You know the bears have struggled to remove strong gap ups, thus, their job once again became more difficult. The market is making things difficult for both sides now. Today was a great day for the bulls technically, so now we wait to see what early next week brings. That should be the defining moment.

When markets get compressed and move straight down you accomplish a lot with regards to sentiment. The bull-bear spread has moved down 18 points from 46 to 28%. On top of that, there are now major out flows from stocks to bonds. Doesn't take long does it? Folks are running to bonds. That's more than interesting, and shows how little it takes in terms of selling to make that happen.

Before the move up late in the week we saw the Dow correct 8%, the S&P 500 6% and the Nasdaq about 5%. That's not all that much. With that little bit of selling folks are running to get out of the game. Have to love it. This tells me the market shouldn't collapse again all that soon, but you never know. There's probably lots of back and forth for a while, so take it easy on both sides. We may need deeper unwinding back up on the daily charts for a bit longer, but don't bet on that too heavily. For now, at least, we're seeing folks get more bearish.

Support now is at today's gap up level on the SPDR S&P 500 (SPY) at 177.72. It won't be easy for the bears to eradicate this level. Only when they do on a closing basis can the bears consider that they're retaking the market back. Anything above that level keeps things neutral. Resistance is at 181.66. There's lots of room to move back and forth for a while just to make things more confusing for folks. If we do weave around for a while, that could allow things to unwind further to the upside on the daily charts, and then we should head lower again, but for now things are quite neutral. Play it as such.

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!

© 2014 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.


© 2005-2016 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

Catching a Falling Financial Knife