OCT 9 INDEX UPDATE
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Short-term technicals readings:
DOW - upper midrange
SPX - upper midrange
OEX - upper midrange
NAZ - oversold region
NDX - oversold region
SOX - CLASS 2 SELL
VIX - midrange
NAZ NET NEW HIGHs-LOWs = negative 43
The previous CLASS 1 SELL signal on the DOW/SPX/OEX is still holding. If the DOW/SPX/OEX were to break above that point, without more selling that would be quite bullish. Having said that, the BKX still looks very weak, and the TRANS has a clear rising WEDGE(bearish). It is more common than not, that rising wedges break to the downside, but its no 100%.
The NAZ was flat yesterday, and the NAZ NET NEW HIGHs-LOWs improved slightly. I still wont make alot out of it, but Im not yet seeing any significant negative or positive hints from the HI-LOs.
For the last 3 days the major indices have had SMALL BODIES/DOJIs. This is not uncommon at short-term tops, although I wouldnt call it a strong reversal signal either.
MAX-PAIN LEVELs:
QQQ - 30, closed at 31.86
OEX - 530, closed at 544
The MAX-PAIN levels for the QQQ and OEX have already been exceeded to the upside by the indices. So the MAX-PAIN should limit the upside. I prefer to use the MAX-PAIN with a buffer. For the OEX, the buffer I use is 20 points. For the QQQ, I have been using 5 points, but in light of the NDX being this low, Im suspecting I may have to change that to arould 3 or 4. So the QQQ and OEX are now approaching the limits of the buffer, which should limit the upside.
Frankly, Im not seeing alot of strong negatives on the NAZ/NDX, but see more negatives on the DOW/SPX. In light of that, Im suspecting that the NAZ/NDX may just pull back a normal amount from the short-term top, wherever that was/will be. Just not yet seeing the potential for a huge pullback in the NAZ/NDX. |
