***** Technical Analysis (Oct 17)****
This is an new TA update.
On Tuesday the major indices were down mildly while the internals were a little worse, and the TRIN's were modestly above 1.00.
It appears that the Dow and S&P500 could continue to rally a little more in the short-intermediate term of 2 wks-2mos, perhaps 3-4% from the prior all-time high of 11,750 for the Dow and the recovery high for the S&P500. Heavy volume recently on rally days are accumulation days and are harbingers of higher prices.
Selling pressure for oil stocks has dissipated a bit now despite crude oil falling today, and the support at 57-58 was tested, and if it fails to hold, then we will see 55. But for now, oil stocks have acted better and have a chance to start a modest uptrend.
It is likely now that the rest of the market will try to play catch up to the megacaps that have rallied strongly, as evidenced by the relative strength of the Dow. Usually tops are formed by double tops and because the Dow has broken out to new all-time highs and the S&P500 has broken out to multi-year highs, more upside action is expected in the weeks to come, and then a test of the next high will probably need to be tested, providing a possible double top later this year or early next year.
The McClellan Oscillators were positive today:
stockcharts.com
stockcharts.com[m,a]waclyyay[pc30!c20][vc60][iud20!ua12,26,9]
stockcharts.com
Below charts:
stockcharts.com
Be sure to use the advantages of the "top-down" approach, a paradigm in technical trading. The bottoms-up approach refers to the idea that market timing is not used and that the goal is to select strong companies from a fundamental standpoint to buy and hold.
The "top-down" approach refers the the idea that one first ascertains the trend of the market, the strongest or weakest sectors for that trend, and the strongest or weakest stocks within those sectors, to trade, all with the trend.
Dr.Bob's commentaries are not to be construed as recommendations to buy or sell stocks, options, or ETF's as Dr.Bob is not a Registered Investment Advisor.
Information and data provided here is believed to be reliable but cannot be guaranteed to be accurate.
Always do your own research and due diligence before investing or trading. Remember that Technical Analysis can change by the day, and as such, one day's TA may not be the next day's TA interpretation.
Dr.Bob's mission is to teach Technical Analysis and demonstrate a structured approach to Market Analysis, for position and swingtrading. There are many other TA structures, strategies and systems.
Dr.Bob no longer hosts Stocktimers meetings on Sunday nights at AOL.
I can be reached at drbob512@msn.com. |
