***** Technical Analysis (July 25)*****
The Major Move indication by the Nasdaq and NYSE McClellan Oscillator readings of only 2 and 3 on Thursday, resulted in Friday's major move in the Dow but not in the other indices. But there are several indications of an upcoming major decline occurring now.
The Summation Indexes remain in a down trend, with the NYSE one in the worst technical shape and the Nasdaq a bit stronger but having a head and shoulders pattern. The MACD for the Nasdaq is still negative and the ROC has weakened and close to bearish divergence.
July's technical action is setting up for the good possibility of a very weak August. The current rally is not impressing technicians despite Wall Street analysts and the media talking up the 4 month up trend.
The S&P 500 has important support near 975 and the Dow will be in trouble if it breaks below 8980 on a close. The Dow and S&P 500 could retest 9352 and the 1015 levels early this week but watch the overall volume and MACD and ROC to discern whether this recent rally may set up a bearish reversal.
Gold probably has more upside room while bonds are at a critical support level and the 10 year Treasuries are oversold, perhaps nearing a substantial rally which could occur in August while stocks weaken.
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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