Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Nas/AAPL Won't Fall.... Dow/S&P 500 Small Pullback...

Stock-Markets / Stock Markets 2012 Nov 27, 2012 - 05:52 AM GMT

By: Jack_Steiman

Stock-Markets

The bid is back in for this market after the weekly charts printed outside sticks last week when compared to the action from the previous week. That normally tells the worst of the selling is over, but that does not preclude one more move lower over time to double bottom. That's unclear for now. The market tried selling today, but, sadly, it's now all about Apple Inc. (AAPL), which had a strong day to the up side, meaning the Nasdaq out performed, closing in the green while the S&P 500 and Dow were down a little bit. In reality a nothing-from-nothing day. However, with the Nasdaq hanging tough, it allowed its short-term chart RSI to remain in the upper 70's. Not a good reading for buying new plays.



The Nasdaq may try for bottom, its last gap down at 2977, but if it gets there, we'll be seeing RSI's in the lower 80's and that's simply unsustainable. Either way the chart will have to unwind before there's any chance of sustainable upside action in that sector and in the market overall. Sadly, it seems when AAPL puts in a topping stick the Nasdaq will have its unwinding. Unhealthy to have one stock so in control of the whole market, but that's the way it is for now. With today's action it seems to me that the bulls can start feeling much better about things, but again, there will be normal pullbacks along the way as well as the potential for one more larger pullback to test the recent lows over time.

The market has been one big whipsaw. There's been lots of large moves up and down. The move off the top was a large one lower. It felt like the beginning of a new bear market, but it wasn't, and should not be going forward for at least the medium-term. Lots of levels were broken to the down side on this 8% pullback but, in the end, the key level of support held on the S&P 500 as well as all of the indexes when looking at the longer-term 3.5 year trend lines. The major factors that show the beginning of a new bear were never in place. Sentiment never got close to extremes. You almost always see near 40% on the bull-bear spread, but this time we only got to 29.7%. No extreme at all.

Good news was still being treated as good news, which doesn't happen when a new bear has begun. If a stock reported good earnings, it was rewarded, not torn apart for no good reason. Lastly, there was never any consistent distribution volume off key-topping areas. With none of those factors taking place it just didn't seem to fit a new bear, thus, why I pretty much always labeled the newsletter as a correction still under way. You always have to be open to a new-bear beginning. I still am always on guard but I don't think that's in the cards here.

The market will be keenly interesting and focused in on the talks that are ongoing regarding the fiscal cliff. In the end, that will have a lot to do with where our market heads. If the leaders can get it together, then 2013 should be a very decent year, although you can expect the usual scares along the way from Europe, etc. Nothing will necessarily be easy but the trend should be higher if the democrats and republicans can play nicely together before the deadline hits at the end of December. We'll see. We can only hope that things will get done for the good of the economy, and thus, for stock market and the wealth of this country.

The S&P 500 is still trading a bit below the big breakout level of 1408. The only problem is, if we break out now, we break out in to very overbought conditions, especially on the Nasdaq, thus, the breakout is likely to struggle early on. It would be best to unwind the oscillators without too much price erosion. That would set things up nicely for the bulls. It's never as easy as it should be, thus, we'll probably break out a bit in to overbought, and then have to pull back some. No way to know for sur,e but the bid is back in the market for now. Until it isn't, of course. Stay patient if you're a bull with the best buying to come when the oscillators reset off overbought. 77 RSI on the Nasdaq is not the time to be buying. If it goes higher first, we'll have to pull back that much more.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 15-Day Trial to SwingTradeOnline.com!

© 2012 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in