Premarkets were flat and melted further down to -0.05% by 9 am indicating an opening with minor losses. Past openings have had little to do with premarket action and have little investor value except to traders looking for an edge.
Markets opened flat, down and very low volume. By the 15 minute mark volatility increased and the averages were being pressured downward (-0.25%) by negative investor sentiments. By 10 am the downtrend was halted and continued to trade sideways in negative territory depressed by poor earnings reports (URBN) (TJX) (PETM) (DKS) (SPLS).
The short term indicators are leaning towards the hold side at the opening. The all important signs of reversal, up or down, have not been observed so we are mostly, at best, neutral and conservatively holding. The important DMA’s, volume and a host of other studies have not turned and that is not enough for me to start shorting. The SP500MACD has turned down, but remains above zero at 4.89. I would advise caution in taking any position during this volatile transition period although Barchart.com shows a64 % buy. (Hard to take seriously.) Investing.com members’ sentiments are 66 %bearish.
In looking at the 50 DMA, the current SP500 opened above that line and the small caps remain just below the 100 / 145 DMA (were the two have crossed). I can not see, as of right now where those large cap MA’s are rolling over to indicate any permanent bear run but the falling small caps are a real worry. (See deviation of large and small caps here.)The NASDAQ 100 DMA has crossed over the 145 DMA and the small cap trend is trending down and the $RUT is below the 200 DMA and remains above the 1090 support.
Bottom line here is that I have not seen any serious bears jumping out of the woods just yet, although I am VERY concerned that ANY minor correction could turn nasty in a heart beat. One significant signal would be losses in any of the major averages that go over the ‘magic’ 3 % and then you need to pay close attention to risk-off tactics. Any market correction over 6% would be an additional signal and I can’t see having one without the other.
After a False Breakout, the Topping Pattern in the S&P 500 Continues
Plus: Despite heading lower, the Nasdaq Composite still hasn’t entered a technical correction. After a False Breakout, the Topping Pattern in the S&P 500 Continues
