tuesday's road map, page-2

In America:

SP500 +1.19%
Dow Industrials +0.76%
Nasdaq100 +1.38%
Dow Transports +0.77%
Russell 2000 +1.37%
Comment: A very strong day with SPX and NDX both up well over 1%. Breadth (R2K) was also very strong. Too strong?

NewHighs/NewLows 79/28. NH>NL. The ratio of NH/(NH+NL) is at 73.1%. Not yet back into the Do Not Sell Zone. The New Low figure is in the Nervous Zone (25-50).

Technical Comment on the SP500:

The SP500 finished at 1430.36. Nearby Support/Resistance: 1416.81/1433.32. Marginally below resistance.
MACD Histogram. Below zero. Negative. But moving up.
MACD. Above zero. Positive.
RSI.9 is at 64.1. Back in the zone where pullbacks can occur.
Stochastic. 67.2. Below its signal line and the 80 level. Negative.
CCI.14: +93.9. Bouncing off the zero area. Positive.

The chart remains within the up trend channel. Indicators are mixed. Overhead resistance around 1433 seems to be important. But today’s momentum is strong and the recent short term pull back (a reversal day, and two days down) can now be read as a bull flag within an ongoing up trend.

We now have three pivot days. The most recent one was on Friday. The low is 1411.9. Any pull back here has to respect that figure.

Some interesting items for Australia today. BHP on the American market was up for the tenth day in a row. It has to stop sometime. Despite the strong American market, Toronto was down -0.12% and the ETF in America for Brazil was down -0.17%. Why should that matter for Australia? Both are commodity based economies. Australia is also a commodity based economy. So don’t expect Australia to show an American style strength today. As I mentioned in the Weekly Report on the weekend, market correlations seem to be out the door. Just to add to the dampening effects, the Ozzie Dollar was down -0.19%. Despite all that, it’s difficult to see us not being up today, especially with overnight strength in BHP.

Redbacka