***** TA Update (intra-day) *****
The markets are down modestly in profit-taking after two very strong days, especially for technology stocks. The gaps from yesterday have held up so far, and if we can arrest the declines (for the day) to the itnra-day lows of yesterday, that would be a positive sign. Then the gaps might not be filled Monday.
The a/d is negative for the Nasdaq and NYSE but not very much, and the up/down volume and TRINs have not been very negative this morning.
We could see an "inside day" today, and if the market internals improve by Monday or Tuesday, we should continue this rally, with more stocks joining. LDFU and high relative strength stocks can achieve uptrend channels even during sideways markets, once they have shown accumulation occurring on good volume.
Stocks are rotating for the most part, and it might not be too late for incremental buying on dips/pullbacks to support levels. Do not ever chase stocks by buying them at the highs of the session nor at the 2-3 day highs.
If we had gapped up at the opening this morning, swing traders would have considered selling into that, to buy back at lower prices when that gap would fill. But we declined from the opening, so that bodes well for this rally to continue. For now, it appears we could rally more next week, after profit-takers get overtaken by those institutions and retail investors who are afraid to be left behind (in their cash-flush portfolios).
We probably will have our serious correction later as dip-buying still seems to be in vogue right now and for the next few days, until we get more overbought. We are not yet in an official bull market, but we could possibly make a higher low during the next correction, which would mark its beginning. For the moment, longs can enjoy this rally, as the technical indicators have more upside to get to extreme overbought territory and for bearish divergences to start to show up. |
