The averages have traded more or less sideways with a slightly negative slant this morning. The SP500 set a new historic high by 0.63 cents and then backed off on falling volume. By the noontime hour the volume was anemic as investors are holding back until Mr. market does something.
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There are all kinds of indicators and I guess instutiona buying and selling is as good as any. What do you think?
Was it really a good day yesterday?
The NYA, the S&P 500, the NDX, and the Russell 2000 all showed a positive level yesterday when compared to their December 31, 2013 close.
But an index that was still not able to clear its December 31 level was the Institutional Index of “core holdings”. It was close … 0.03% away, but it still didn’t clear the hurdle at the close (see the posted chart below).
Why do we look for the Institutional “core holdings” to break out above its December 31st. level?
It is because, that in the past, the Institutional Index was always the only index to fail at market peaks.
It is [not] that we are saying that this will turn out to be a market peak yet, but the stock market can’t move to new higher levels and leave the Institutional Investors behind. Therefore, we will need to see the value of the Institutional “core holdings” break out to the upside for a market continuation.
Was it really a good day yesterday?
The short term indicators are leaning towards the hold side at the midday. The all important signs of reversal, up or down, have not been observed so we are mostly, at best, neutral and conservatively holding. The 50DMA, volume and a host of other studies have not turned, only a 6% correction (and recovery) and that is not enough for me to start shorting. The MACD has turned down slightly, but remains above zero. I would advise caution in taking any position during this volatile transition period although Barchart.com shows a 80 % sell. (Remember this has been negative for days.)
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