AWWWWW - Jako. Whadda we gonna dooooooooooooooo! Who's game enough to step into Jako's giant shoes?
In America:
SP500 -0.39%, Dow Industrials -0.26%, Nasdaq 100 -0.31%, Russell 2000 -1.77%, Transport -1.03%.
The lower quality indices (Russell 2000 and Transport) both have bearish candles – but still above the 20-Day MAs. The higher quality indices (SPX, Dow 30 and NDX) are more ambiguous. Nasdaq 100 -0.31% (large caps) performed much better than the broad based Nasdaq Composite -0.77%. There’s a lack of confidence showing up in the market. That may be the start of a move down.
Here’s the SP500 chart:
This is set up for a pull back. Nothing serious at this stage. The Index poked above the restraining line of the Rising Wedge on Thursday, and now retreated. False breaks usually lead to moves to the other side. We haven’t yet seen a break to the downside of the Rising Wedge, so catastrophic views are hardly warranted. This could just as easily morph into a sideways trading range. The 50-Day MA is about -3% lower. If we get a serious pull-back that is a likely candidate for support. I noted in the Weekly Report that Investor Sentiment hasn’t reached bullish extremes which usually precede serious retracements. Lately, two days down is about all the bears can hope for. Even back in early April, when we saw an ABC pull-back, the A and C legs could only manage two days down in each leg. We could see a similar scenario unfold here.
Commodities:
CRB down seriously -0.97%. Energy continues to fall -0.74% as traders get over Iraq/Ukraine jitters. Industrial Metals -0.79%. (I’m getting discrepant readings on Industrial Metals data. ***** quotes Copper as flat +0.00%. The only base metal they have down is Nickel -0.48%. So something doesn’t add up.) Precious Metals down -0.31%, with GLD off -0.11%. Gold Miners Index (GDX) in America, however, was down seriously -1.74%. Here's the chart:
Despite the big daily fall, it was still an “inside day” – today’s range was inside the range of the previous day. It remains within a short term up trend channel. A break to the down side of that might result in much bigger falls. The negative divergences on the Indicators suggest we’re going to see more downside. This has stalled at horizontal resistance, so a fall through the rising support line would be serious. Watch.
Oz stocks in America:
BHP -0.49%, Rio -0.97%, Westpac flat -0.03%, ANZ up marginally +0.16%. EWA flat +0.00%.
Ozzie Dollar +0.26%. So discounting for the currency effect, those two miners are not looking too flash. BHP was up modestly in Australia yesterday +0.27%, so the sentiment seems to be turning against our miners in America.
(20min delay)