NOV 29 INDEX UPDATE
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Short-term technical readings:
DOW - overbought region
SPX - midrange
OEX - midrange
NAZ - oversold region
NDX - oversold region
VIX - 30.12, midrange
CBOE PUT:CALL RATIO - .82
Per my short-term technicals, we have sector rotation between the NAZ and the DOW with the SPX in the middle. If the NAZ/NDX continues down, I would get a CLASS 1 BUY SIGNAL either on THUR or FRI. The opposite applies with the DOW for a CLASS 1 SELL signal.
Its negativity in the NAZ/NDX is quite obvious, again producing another lower low. The NAZ/NDX rallied at the end of the day giving a hint that some sort of a bounce may be starting. However with the GTW/ALTR news, the NDX futures is right now down about 55 points. Not off to a good start for tomorrow if there is not change overnight.
With the after hours news and the NDX FUTURES down 55, we may get to see some sort of a short-term or mid-term capitulation in the NAZ/NDX tomorrow. I would not consider it a major capitulation since the DOW/SPX/OEX are not near the oversold region.
As mentioned on SI today, I am suspecting a trading range for the NDX in the 2600-1900 region eventually. This range was the same levels we saw in 1999 before the blowoff to 5000. Im not saying that we will reach the low end of this range immediately, but that its a possibility.
The next horizontal supports for the NDX is 2470, then 2300.
The NAZ NEW LOWs closed at 573. For reference, the bottom in OCT 1998 had the NAZ NEW LOWs around 1500. Im not saying that it would have to get that low, but just highlighting it. For a MAJOR BOTTOM I do suspect more extreme levels in the market internals and sentiment indicators.
On SI today, I mentioned prior to the close that there was a possiblity of an "IDENTICAL 3-BLACK CROWs". With the late day rally the 3-CROWs was not formed.
If the NDX approaches 2300(closing price) we will be adding a strong UOPIX(long-NDX) position, but our total long position will still be under 50%, just in case.
One very negative possibility, which I rather not bring up(ggggg), is that the NAZ/NDX doesnt rebound untill the DOW also gets to the CLASS BUY territory. That would be really lousey for LONGs.
seeya |
