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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Johnny Canuck who wrote (59608)	8/6/2024 12:13:54 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 69345

Major indices sold off in reaction to Nikkei selling off. Nikkei sold off due to US market sell off on Friday. This was due to higher that expected unemployment numbers. The open was down as much as 6 percent but quickly reversed as clammer heads took over. Nikkei is a lagging indicator so it was not going to set the direction so much as lag it. One explanation has some trader take profits on the short side to re-load later. Another is traders needed to hedge the fall as too many puts were outstanding and some calls needed to be bought to hedge the bet. If true we will see more selling this week as people take new short positions. SP500 stopping short of a long term sell signal. Intermediate sell signal confirmed. RSI indicates a counter rally bound is expects over the next few day. The range of the bounce will determine if this is short term event or a trend that will play out to the downside of the next few weeks. DOW is setting up for an intermediate and long term sell signal. This show how compressed the sell off has been in time. A down day tomorrow at the close would confirm the sell signal. RSI also indicating ovesold condition. Note that the RSI down no indicate an instantaneous re-bound. You need to use other indicators like support and resistance or moving average to work out timing. In other words soon but no idea when without the other indicator. DOW transports confirmed intermediate and long term sell signal. DOW lead the last rally. It may be the canary in the gold mine. DOW utilities back to previous high, so short term neutral. Despite the rotation to safety on Friday it looks like it did not take. Bull market still has some life and interest rate cut not assured according to this index. Interestingly TLT, short term trading of long bond does not agree wit the DOW utilities. USD broke the range just below 1.30 but managed to close right at the level. The break indicates fear of the USD denominated assets and closing at the support level means traders and not exiting wholesale yet. COMPQ intermediate sell signal confirmed. Long term sell signal setup in place. Lower low tomorrow confirmed the long term sell signal. Russell 2000 intermediate and long term sell signal setup. Financials seeing intermediate sell signal setup. It stopped short of the 150 day SMA so the long term sell signal setup is not in place yet. Energy sector had a confirmed intermediate and long terms sell signal. Gold still holding on to the uptrend in all timeframes. Consumer discretionary confirming intermediate and long term sell signal. . Semiconductor confirmed intermediate and long term sell signal. The fact some indices are seeing intermediate and long term sell signals or sell signal setups in such a short period of time confirms the averages were starting to converge through a lower rate of climb in the indices. This usually means the rate of increase is starting to labor. This usually happens when the market has come too far to fast and traders are starting to get cautious. This kind of damage to the psychology of traders usual will take some time, perhaps weeks, to overcome. Don't expect and immediate rally back to old high. Expect counter rallies and then a dip down. If the indices can then set a new high the market will move higher, but usually it is a lower low which means weeks if not months of negative sentiment.