***** Technical Analysis (June 10)*****
A late rally was not unexpected as the market internals, especially up/down volume, remained positive despite mid-day weakness, but the rally was on only moderate volume, which is disappointing for the bulls and is suspect in the short term.
The McClellan Oscillators were at +2 on Monday's close and were on the verge of turning negative when the rally today improved them to +11 and +14 for the Nasdaq and NYSE. It would not be surprising to see them turn back down as Wednesday could be weak.
The failure of the Dow so far to close above 9077 is a near term negative and more profit-taking could occur this week, or at least for the next day or two, as the rally today was unconvincing.
If the volume had been heavier, we could have had a very good chance of breaking out above 9077 tomorrow, which could have been on the way to 9400 within a few days.
If the internals are very strong, including up/down volume, later this week or early next week, then we could still have that breakout.
The Aroon worsened to neutral after having been positive for many weeks, but it usually gives a near term contrarian reading or signal because it changes when it is time for a reset. The ROC importantly remains neutral, not negative and the OBV remains positive, along with the Money Flow and Acc/Dist and DMI. The RSI rose to 66.9 and has room to get a bit higher.
Gold fell sharply today as it continues its correction but the longer term remains positive. The US dollar remains in a bear market.
The Nasdaq has some resistance at its recent high of 1684 but long term resistance comes in at about 1750. The S&P 500 may be able to get above 1,000 resistance if there are heavy volume rally days in the next week.
But negative trend reversal will occur if we retest but don't break out on heavy volume.
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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