Showing posts from July, 2019

Fed Confusion Tames Gains

Markets didn't react well to the Fed rate cut or the words of Jerome Powell, although today's selling didn't kill the breakouts, it did leave them under pressure. The S&P undercut its 20-day MA and only tagged breakout support of 2,953 but volume did rise in confirmed distribution. Today's action undercut the signal line in on-balance-volume and generated a sell trigger in ADX.

The Back-and-Forth Between Bulls and Bears Continues

Sellers returned as the sequence of buy-sell-buy-sell continued. Action for the last four days continued to coil with the Russell 2000 showing this best with a series of inside days.  I would like to see this pattern break upwards and pressure 1,610s as it would maintain bullish confidence for Large Caps and Tech indices too.  The Russell 2000 still suffers from relative underperformance despite its recent improvement, but all other technicals are bullish, including a MACD trigger 'buy'.

New Highs For S&P as Russell 2000 Gains

An excellent end-of-week finish left markets well positioned heading into this week. The S&P finished with a new all-time high on light-ish volume. Gains weren't enough to reverse the MACD trigger 'sell' but other technicals are bullish.

Yesterday's Gains Consolidate

Today's action - paired with yesterday's - has given bulls confidence more gains could be on the way. The losses were not significant and there was a great recovery breakout in the Russell 2000 'bull flag', which was feeling the pressure all through last week. Again, just as any losses were mitigated by the broader trading range, so was yesterday's gain. However, it does suggest there are buyers willing to come in if the water is nice.

Solid, Low Key Gains for Markets

Nothing spectacular from markets, but the risk of breakout failures eased with today's gains. Best of the action came from the Nasdaq as the risk of a potential 'bull trap' declined. I would like to see the MACD trigger 'sell' reverse to confirm the breakout, but I was happy not to see the 20-day MA undercut which would have just extended the prior consolidation and keep traders reluctant to get involved.

Markets Push New Highs for July

Getting back into the grove after my vacation. The month started with indices pushing new all-time highs on summer trading volume. The past week have seen some easement off those highs but there is plenty of support to work with. For the S&P there is the 20-day MA and breakout support of 2,953 just below. The recent selling did produce a MACD trigger 'sell' but other technicals are all in good shape.

Early Enthusiasm Fails To Hold

This will be the last post until my return from holidays on July 22nd.  Today finished with a bit of indecision as indices closed with bearish 'black' candlesticks; there were strong opening gaps but no follow through with afternoon buying. The risk is for a gap down tomorrow, which would leave bearish 'reversal evening stars'. The biggest gain came from the Nasdaq. The index gapped over 1%, but this gap didn't clear the April high. Volume was reasonable if a little unspectacular. Relative performance against the S&P remained strong.

Small Caps Maintain Strength

It was another good day for Small Cap stocks as the Russell 2000 added over 1% to bring it into a challenge of the June swing high. Just as the declines of the early part of last week were of lesser significance because of the broader trading range between 1,500 and 1,610; the same is true for Thursday's and Friday's gain. The one aspect which is interesting is the improvement in relative performance against the S&P. With money flowing back into Small Caps, the groundwork for a larger, secular rally is been put into place.


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