Sunday, July 25, 2010

Weekly Market Commentary: Pushes Higher

The S&P closed the week up 3.55% higher but hasn't yet cleared the highs of the bear flag which lurk at 1,131 but so far the initial decline from 2010 highs has honored Fibonacci retracements



In support, the NYSE Summation Index looks to have flinched and jumped early. A stochastic 'buy' is undermined by the lack of the oversold condition in the index itself.



The only S&P breadth indicator to confirm a bottom (so far) is the S&P Percent of Stocks Above the 50-d MA. It has jumped from a low of 5.4% to 66.0% in a number of weeks.



The Nasdaq has pulled further away from its head-and-shoulder reversal neckline but it hasn't yet reached an oversold condition.



The Percentage of Nasdaq stocks above the 50-day MA matched its S&P cousin with a confirmed 'buy' signal.



So while the S&P and Nasdaq are pointing more towards a bottom they are not fully confirmed - yet.

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