"Cherney on the Market"--S&P: "Short-Term Profit-Taking Pressures On the Rise"
personalwealth.com
-----------------------------------
Full Text, edited for emphasis.:
>>>Thursday July 13, 2000 (4:42 pm ET)
NEW YORK, Jul. 13 (Standard & Poor's) - Thursday's market saw the NASDAQ print in the next layer of resistance 4177-4475. There was good volume accompanying the move and, on balance, I think we should view the day as a confirmation of Wednesday's breakout above the 4073 level.
Upside followthrough could last another 3 trade days, but as mentioned in yesterday's end of day comment, position traders (a trader who takes a position for a few days as opposed to a day trader who won't carry a position overnight) will be looking to book profits so even if the PPI is a market friendly number. A surge higher could invite profit-taking.
I have nothing to suggest that the upside is over but the resistance in the 4177-4324 area is formidable and it is doubtful that we can just push right through it without some sort of retracement.
I'll be keeping an eye on the CBOE's Equity Only Put Call ratio, we haven't reached the "caution" level yet, but an end of day reading at 0.32 or lower could signal a short-term time-out.
The next layer of resistance within the 4177-4324 band is 4206-4324 with a focus 4256-4287. - Immediate NASDAQ support is 4173-4150, then 4136-4073 (4073 is the bullish breakout point) - The S&P 500 has immediate support at 1479-1470. The index is testing resistance at 1488-1516 and this area offers considerable resistance. The S&P 500's next layer of resistance is 1524-1552.87.
Tomorrow is a Friday, and this is the summertime. A friendly PPI could push prices higher at the open but then fade into the close. On balance though, downside appears limited.<<<
------------------------------------------------------
Puts/calls Ratio:
equis.com
>>> The P/C Ratio is a contrarian indicator. When it reaches "excessive" levels, the market usually corrects by moving the opposite direction.
The following table***, general guidelines for interpreting the P/C Ratio.
However, the market does not have to correct itself just because investors are excessive in their bullish/bearish beliefs! As with all technical analysis tools, you should use the P/C Ratio in conjunction with other market indicators.<<<
*** See link above. |
