***** Technical Analysis (for January 30)*****
The markets were down sharply in light trading as the two day rally ended and the low of yesterday was taken out on the Dow, a near term negative. The Nasdaq had almost exactly the same range as yesterday but closed on the lows of the session. The S&P 500 was down to 844.
The Nasdaq TRIN closed at a negative 2.23, with a/d of 5/11, up/down volume 1/4, indicating moderate distribution, on 1.45B shares. The RSI fell to 39.9, while the MACD, DMI, ADX, Money Flow and Acc/Dist remained negative and the Williams%R and CCI worsened to negative. The index is below the 200 and 50 day moving averages which are at 1407 and 1400. The failure to stay crossed above the moving averages bodes badly for the index.
The Nasdaq McClellan Oscillator came back down as expected, to -36, with the 10% index below the 5% and zero line. The Summation Index is -281 and falling fast but has a lot more room on the downside. The monthly stochastic dropped to 17% and barely crossed up, weekly is 51% crossed down with much room, daily 1% but the "d" is high, and hourly is 4%.
The NYSE TRIN closed at a very negative 2.10, with a/d of 1/2, up/down volume 1/4, indicating moderate distribution, on 1.5B shares. The McClellan Oscillator fell to -49 and has a ways to go yet before becoming extreme.
The VIX and VXN MACDs are clearly crossed up, a bearish signal, particularly since the raw readings have a lot of room. The put/call ratio rose to .87 and its MACD is still negative.
The Dow has closed below 8,000 for the first time in months, and is apparently putting in a series of lower highs and lower lows. The next support level may be 7500-7600 and resistance is now 8,000 and 8,250. A failure to break above 8250 in the next week on any rally would portend another fall of significance to new recent lows.
The Nasdaq still has those gaps below at 1221 and 1166, which act like magnets in a bear market after the technical rally is over, which it apparently is.
Watch the market internals to signal whether any bounces will be strong or not. But the trend reamins down.
Gold has traded as low as 363 but held support above 359, so it may be consolidating its gains before another runup past 369, towards 379 at least.
Dr.Bob's commentaries are not to be construed as recommendations to buy or sell stocks, options, or ETF's as Dr.Bob is not a Registered Investment Advisor. Information and data provided here is believed to be reliable but cannot be guaranteed to be accurate. Always do your own research and due diligence before investing or trading. Remember that Technical Analysis can change by the day, and as such, one day's TA may not be the next day's TA interpretation.
Dr.Bob's mission is to teach Technical Analysis and demonstrate a structured approach to Market Analysis, for position and swingtrading.
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