***** Technical Analysis (for April 28)*****
The major indices may be forming an ascending triangle which has bullish implications (of course there could be a false breakout) but other technical signs are negative other than in the very short term. The Dow is acting like it wants to retest 8522 and perhaps take it out with 8600 the next target.
The majority of indicators are overbought without the indices moving that much, which implies a resetting rather than a major up trend, and has bearish implications for the short-intermediate term of 2 weeks to 2 months, or for the intermediate term of 2 months to 6 months.
Today's rally was on light volume of 1.45B/1.3B on the Nasdaq/NYSE, respectively and tomorrow the market is likely to follow through to the upside (probably in the morning), and if it has very positive up/down volume figures, then 8522 could be taken out.
The question is whether the volume will be heavy enough to engender some panic buying, and whether we can have confirmation of this being a leg up by having at least 3 rally days with volume over 2-2.2B shares, or if the days are numbered for this recent "war rally."
Today, the Nasdaq closed at 1462 and seems poised to take out resistance at 1467 and then the next resistance level is 1521. The S&P 500 has resistance at 925-930.
The Nasdaq TRIN closed at a positive .50, with a/d of 21/10, up/down volume 4/1, indicating moderate accumulation on light volume. The MACD, DMI, CCI, Acc/Dist and Aroon remain positive while the Williams%R improved to positive. The RSI rose to 64.
The Nasdaq McClellan Oscillator rose to +34 and its Summation Index is nearing a level where it topped out a few months ago near +300. The weekly stochastic is 97% crossed up, daily 95% and the hourly 95%, and this stochastic "pop" needs heavier volume to maintain the high levels.
The NYSE TRIN closed at a very positive .44, with a/d of 3/1, up/down volume of 7/1, indicating pretty strong accumulation but on light volume. The McClellan Oscillator rose to +36. The weekly stochastic rose to 72% crossed up, daily 90% and hourly 81% crossed up.
The VIX and VXN dropped to 23.1/32.7, respectively and their MACDs remain crossed down, so they are still giving positive readings but are near extreme levels sometimes associated with market tops. The put/call ratio fell to .76 and its 50 dma dropped to .79 and its MACD is slightly negative.
The AAII and Investors Intelligence surveys are indicating that there is too much bullishness present so from a contrarian view, caution is inferred for long positions.
The technical signals are mixed as usual, and the near term or short term has positive momentum, but some technical signs are warning that the market could reverse its trend before too long.
Thus, no one has a crystal ball telling what the exact trend will be, but a diligent and objective analysis of the technical data can assist greatly in trading decisions.
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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