Wednesday, February 11, 2009

Market Sentiment: Another False Dawn

After an initial promising kick in the number of stocks popping over their 200-day MAs, yesterday proved to be a kick in the teeth as market sentiment was scrambled. In effect, sentiment was downgraded from net positive to a trading range (but not outright negative).

The Nasdaq was in better shape, but it too is faltering

Given the relative standing of breadth indicators the expectation would be for lower prices over the next 1-6 months contrary to my initial assertion for a rally into May. This scenario has yet to confirm, but it's now on the table.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, market alerts and stock charts website