***** Technical Analysis (May 8)*****
Each time the market has gotten significantly weaker as indicated by the McClellan Oscillator, Williams%R, CCI and Acc/Dist as occurred today, stocks were able to reset and rally afterwards.
Today the McClellan Oscillator dropped to +13/+19, on the Nasdaq/NYSE, respectively, but it may be too early to push the panic button because they are still in positive territory.
The Nasdaq TRIN closed at a negative 3.10, with a/d of 2/3, up/down volume of 3/13, indicating mild to moderate distribution, on light volume of 1.6B shares. The MACD, DMI, Money Flow and Aroon remain positive. The ROC remains negative, while the RSI dropped to 61.
The NYSE TRIN closed at a negative 2.31, with a/d of 7/9, up/down volume of 1/3, on light volume of 1.3B shares, so there wasn't heavy volume distribution here either.
The weekly stochastics remain crossed up while the dailies are crossed down. The slow and fast stochastics on stockcharts.com are crossed down from high levels.
The VIX and VXN MACDs are crossed down, a negative sign. The put/call ratio rose to .98 with a neutral MACD reading.
The market is probably not ready to drop precipitously now but the next rally has a lot to prove and to prevent a series of lower highs on some of the technical indicators and charts.
As mentioned in the last couple of sessions, the market was quite overbought early in the week and due for at least a correction, which we are seeing now. But it is possible that we are nearing the end of the topping formation and could be in nearing the trend reversal after two months of rallying.
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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