By Lawrence G. McMillan
I guess politicians don't understand that the end of the year is supposed to be a time of holiday celebration and little market movement. Amazingly, this sharp decline today may not actually change the technical picture much -- unless the decline gets worse.
$SPX closed Thursday at 1443.60, with the 20-day moving average at 1420. The 1420 level is also a support level, extending back to October.
Meanwhile, the equity-only put-call charts continue to remain strongly on buy signals.
By Lawrence G. McMillan
The broad market, as measured by the Standard & Poor’s 500 Index has had a pretty good week. First, the 1,420 area was overcome, followed by a pullback to slightly below that level.
By Lawrence G. McMillan
Stocks continue to work higher. The main cause is the unwinding of previous pessimism (see put-call ratio charts, for example), although the media won’t believe that. They are certain it all has to do with the fiscal cliff. Regardless, we are beginning to see overbought conditions again, and a short-lived pullback might be in order. However, with the holiday period approaching, it is unlikely that there will be much activity after tomorrow, for much of the remainder of this year.
By Lawrence G. McMillan
The stock market, as measured by the S&P 500 Index ($SPX), moved higher over the past week, overcoming resistance at 1420 and then also at 1430. However, since Fed Chairman Bernanke spoke on Wednesday, the market has pulled back. So far this pullback has caused only minimal damage to the technical indicators, and it would be a relatively simple matter for the bulls to regain control.
Put-call ratios have been strongly bullish and remain so today.
However, market breadth indicators are turning bearish.
By Lawrence G. McMillan
The stock market edged higher yesterday, which keeps alive the prospects of an upside breakout in the near future. Equity-only put-call ratios both made new relative lows on their charts, so that is quite bullish. Recall also that the Total put-call ratio moved to a new buy signal at Friday’s close. Breadth was especially positive in terms of “stocks only” data yesterday, and both breadth oscillators remain on buy signals.
By Lawrence G. McMillan
The market has drifted into a dull, waiting state. Despite what appeared to be upside breakouts last week, there was no follow- through. In the end, it will most likely come down to $SPX price once again. In recent days, $SPX has been bounded roughly by resistance at 1420-1425 and by support at 1395-1400. A breakout in either direction would likely create some momentum.
Equity-only put-call ratios have remained on buy signals.
Market breadth oscillators have deteriorated, but they still remain on buy signals (barely).
By Lawrence G. McMillan
MORRISTOWN, N.J. (MarketWatch) — Bullish and bearish forces are both at work, technically as well as fundamentally. Thus, the market is at a point where it could rise sharply or fall sharply — an inflection point.
These matters should be resolved in the days ahead, although the “noise” emanating from the fiscal-cliff discussions may attempt to distort things.
By Lawrence G. McMillan
With the “fiscal cliff” dominating the news, the media tries to link every market wiggle to what some politician has just said about it. Meanwhile, there are plenty of real market forces that are influencing the stock market, but those seem to only be of interest to participants who aren’t media addicts – i.e., only a few. It is our contention that these “real” factors are what is actually driving the market.
By Lawrence G. McMillan
Now that $SPX has closed above 1410 on a closing basis, that is a bullish upside breakout. There is further overhead resistance at 1430, and then it is possible that the market could try for the yearly highs near 1470.
Equity-only put-call ratios are solidly on buy signals. They turned quickly from uptrends to downtrends, just last week.
Market breadth indicators have swung back and forth with short- term movements. But now they are solidly on buy signals.
By Lawrence G. McMillan
MORRISTOWN, N.J. (MarketWatch) — While there are still some mixed signals for stocks, some very powerful signals have lined up so that the bulls once again have a chance to take control of this market.
