In America:Dow Industrials -0.05%Dow Transports +1.18%SP500...

In America:

Dow Industrials -0.05%
Dow Transports +1.18%
SP500 +0.17%
Russell 2000 +0.73%
Nasdaq100 +0.31%

Comment: Dow 30 and SPX both finished flat – like yesterday. Volume was at the top of the recent range . Yesterday, the Dow 30 had a remarkable finish. Today was even better. A wide range day – the Dow 30 went below Friday’s low then rebounded some 185 points.

NewHighs/NewLows 14/114. NL>NH. The ratio of NH/(NH+NL) is at 10.9%. The Ratio is back in desperation territory below 20. New Lows above 100 suggest panic selling. The question is: Was the selling by dumb money or smart money? Today’s big reversal suggests it was by dumb money.

Looking at the ten SP Sectors on the American market, the only sectors down today were defensives (Consumer Staples, Health, Utilities). That's a bullish indicator.

Technical Comment on the Dow 30:

The Dow finished at 12496.1. Support/resistance – 12230/12770.
Indicators:
Stochastic: 18.6. Oversold. Above its signal line. Needs to get over 20.
RSI.9 is at 30.3. Just above 30. Needs to get over 40 to be in the neutral zone.
MACD Histogram. Above zero. Fantastic.
MACD. Below zero. Negative.
CCI.14: -93.7. Needs to be above -100 to be in the neutral zone.

The 10-DayEMA is below the 20-DayEMA. Negative.

Today’s gigantic reversal is good news – especially as the candle dipped below the recent low of this pull-back. This provides the bulls with their best chance. It needs confirmation of an strong up day.

I’ll stick my neck out – I think today’s low is the end of this pull-back.

The long term trend is down. The medium term trend is down. The short term trend is undecided.



Redbacka