***** Technical Analysis (for March 24)*****
While a correction was expected today after the huge runup and overbought indicator readings, apparently the war news hammered the market in addition to regular profit-taking, as the Dow fell over 300 points and the Nasdaq suffered a drop of 51 points, a huge percentage loss.
The "relief rally" that has occurred as a war and pre-war rally from the March 12 lows was severely tested today. The selling momentem is expected to carry over into Tuesday's early trading.
Today, the Nasdaq TRIN closed at a very negative 3.43, with a/d of 7/23, up/down volume 1/11, on light volume of 1.3B shares. The MACD, DMI, Money Flow and Acc/Dist remain positive while the Williams%R and CCI worsened to neutral. The rate of change, OBV and Aroon remain neutral, and the RSI fell sharply to 54.7.
The Nasdaq McClellan Oscillator fell sharply to +16, and its 10% index fell below the zero line but is slightly above the 5% index. The weekly stochastic crossed back down to 43%, daily 67% going down and hourly 3%.
The NYSE TRIN closed at an extremely negative 5.01, indicating severe distribution, with a/d of 7/25, up/down volume of 1/16, on light volume of 1.3B shares, the only "saving grace." The weekly stochastic is 49% going down, daily 72% going down, hourly 22% crossed down.
The VIX MACD is still crossed down while the VXN MACD is crossed up a bit. The put/call ratio rose to .85 and its MACD is giving a bearish reading.
The Nasdaq remains above its 200 and 50 day moving averages, while the other major indices are now trading below theirs.
The question now is whether this decline is going to be contained and result in a resetting of the supply/demand balance and technical indicators prior to another rally, or if it indicates a trend reversal back down.
The MACDs, Money Flows, and McClellan Oscillators need to remain in positive territory to suggest that another rally is forthcoming, and the Oscillator will be hard-pressed to stay positive as selling pressure is expected to follow through on Tuesday with such a weak close.
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.
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