***** Technical Analysis (June 9)*****
The market did indeed follow through today on the downside from Friday's second half decline, though the drop was contained and on lighter volume than in the past 8 sessions.
The Dow couldn't hold 9000 and the next support level is 8800 while the S&P 500 has it at 965 and then 950. The Nasdaq has broken out to the upside so much in the past 2 months that there is much support all the way down to 1430, starting first in the mid-1500's and then about every 50 pts.
The McClellan Oscillator has weakened substantially and the question is whether the trend has reversed or not. The Summation Indexes are so high that it will take some time before there is any acceleration to the downside.
The daily charts indicate that we could have another runup in the major indices if the recent action is indeed just a pullback or correction, as the trend channel is holding so far. Also, there was strong accumulation over the 8 sessions prior to last Friday.
The majority of technical indicators remain positive while the Williams%R and CCI have worsened to neutral.
The daily stochastics are mixed on the indexes while the weeklies and monthlies are still crossed up so we could see more strength in the next couple of weeks.
Volume was only moderate at 1.9B/1.3B shares on the Nasdaq/NYSE, which is what bulls want on declining days. And then the volume should increase again on the next 1-2 rally days, which may start back up within 2-3 days.
Strong market internals with heavy volume on a retest of 9077 could result in a break out once and for all, which would imply a minimum of 9400, to catch it up somewhat to the Nasdaq and S&P 500.
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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