Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Zero Follow-Through For The Bulls....Banks Under Severe Pressure....Oil Slammed Again

Stock-Markets / Stock Markets 2016 Jan 26, 2016 - 06:50 AM GMT

By: Jack_Steiman

Stock-Markets

Friday is looking more and more as if it were simply one of those bear-market rally days from deeply oversold conditions. The only problem being it wasn't that great of an up day. The real powerful, bear-market rally days can be up 2.5% to 3% in a single day. Friday was nice, but far from that type of day thus it seemed as if more upside was likely short-term. Not to be. The market started out down some and tried to fight to green before the bears came in and took it back down. The market stayed down for the better part of the day, but what was most important was how we finished.


A nice round of selling in the last hour allowed the market to close basically on the lows with the Dow down another two-hundred points. Friday gone for the most part. Not the type of action you see when you're in a bull market. Stocks like Goldman Sachs (GS), which were up huge on Friday gave back more than it gained. In one day as well. The action we've been seeing over the past three-plus weeks is purely bearish. The market tries to rally off of oversold or tries to rally off of positive divergences on the short-term, sixty-minute charts, but nothing sustained occurs to the up side.

A small rally, and sometimes even not, but mostly small gains, and then is just disappears in no time. I think by now all of you can recognize all of the changes that have taken place that show the indexes are really no longer in bull-market mode. The market may only be beginning to fall from the all-time S&P 500 2134 highs. We may not see that level for many, many years to come. Notice, I say may as you never say never in this crazy world of Disneyland, but to me it appears the highs are in for years to come. Loads of rallies along the way with some of those rallies quite strong, but the trend now is becoming clearer to all of us. It's mostly down with the usual bull-market traders trying to keep it alive. How long before they finally give up is hard to tell. They are a very stubborn group as they have been rewarded for quite some time. For now, your focus should be what today's market told us. The market isn't in a very bullish mood. The bears are slowly, but surely, making progress, but the bulls will always be in there fighting, and so you can get caught up emotionally when you shouldn't be doing so. Be careful, and keep those emotions in check as much as possible. The market has changed its stripes. What you see it truly what you get.

This evening you will see lots of charts related to the banking world. Something is very wrong there and we don't know what it is quite yet. That said, make no mistake about it folks. Something is very wrong. Study these charts and notice the moves down for just this month alone. Bear-market percentages just for this month. They are melting lower and not at all respecting support levels. Like a hot knife through butter they are melting through key support, which just doesn't happen in the world of lower P/E's. If something implodes somewhere around the world, which seems to be the message things can get really bad very fast for the entire stock market so be careful, especially playing anything related to banks or financial's. I can understand the percentage losses in these stocks if the moves occurred over a six-month period, but we're talking three weeks here. These were the stocks that took Friday's rally and made it look non-existent today. No one wants them with the bigger problem being how heavily weighted they are for the indexes.

These are the leaders. When they fail it's very hard for money to rotate around and keep the market moving upward. So many other sectors are failing, thus, the market overall is finding it harder to rotate. Transports, semiconductors, biotechnology and many more are all failing. We're close to something nasty, but we're not there yet, and we still have very compressed oscillators thus a rally can still occur at any time. Maybe Apple Inc. (AAPL) can help the market tomorrow evening when they report their numbers, but time is running out. The bulls are teetering here. They need something special and they need it fast. It's looking more and more that something nasty is lurking out there in financial land. Time will tell.

Oil didn't escape the carnage today. They were so wonderful on Friday, and that had everyone talking up the energy sector. Oil was out of the doldrums only to see larger losses today than what we saw in gains on Friday. This sector has been the absolute leading sector in terms of bearish behavior from a long time ago. Folks are continually trying to catch that all-elusive bottom. It just hasn't happened yet, and may not for far longer than anyone thought humanly possible. Another area to stay away from although most won't as any up day gets folks, yes, you guessed it, emotional! The bottom is in. Folks chase such as they did on Friday and then today happens. Wash and repeat. It's so hard to stay away as most of you want so desperately to catch every single point of upside. The angst when you think you're missing something is very interesting. The same lessons keep getting taught over and over again. try not to learn to many of them. Support at 1812. Resistance at 1909 short-term.

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!

© 2016 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