charts courtesy of stockcharts.com
Two days has passed since the so called key reversal day of Nov 12, and no follow through rally yet. On the positive side, the drift lower has been happening on contracting volume, and breadth that is not horrendously negative.
S&P closed right at all important pivot area of 850. Interesting how key chart points stop the daily activity and leave things suspended for another day. Market has to get its act together soon, or it will reverse whatever is left from its mid-term buy signals.
There still is no resolution to short term wave count scenarios that we have discussed, and all of them stay valid.
Some sectors have started showing relative strength compared to the general market. Energy, consumer Staples, Utilities and Healthcare ETFs (XLE, XLP, XLU, XLV) are working on rising lows. It is just an observation. I am not trying to imply that these sectors will not join a down party if general markets start to break down again.
It still remains a market made for disciplined traders.
Here's a link to a recent interview with Stan Weinstein. His book Secrets For Profiting in Bull and Bear Markets is the foundation upon which I have developed my approach to trading.
S&P 500 – May 15, 2012 - Bottom Line: Long term trend is up. Mid-term trend is down. Short-term trend is down Weekly S&P stage is Late Advance (2-C) Daily S&P stage is Strong Decli...
1 year ago