***** Technical Analysis (July 30)*****
The market was virtually flat today but a few of the technical indicators did change.
The rate of change has been weakening and can now be interpreted as negative, giving a bearish divergence, and the Acc/Dist and Aroon worsened to neutral. The Money Flow remained positive while the Williams%R, DMI, CCI and OBV remained neutral.
The Nasdaq McClellan Oscillator dropped to -10 from -3, while the NYSE Oscillator reading only changed by one from -39 to -38, warning of a major move by early next week.
Sentiment indicators are mostly negative, with the Investors Intelligence has 55% bullish vs. 19% bearish, and the VIX/VXN MACDs and RSIs showing bearish divergences.
The pivot points I see for the indices are their support levels of 8950, 975, and 1680 for the Dow, S&P 500, and Nasdaq, respectively, on a closing day basis. My confidence level for a break of these levels in August is the highest I've had since other technical rallies failed in 2000, 2001 and 2002.
A break below those levels is expected in August, leading to support levels to be tested at 8250, 900, and 1500 areas, perhaps in September or October.
Gold is still correcting but is nearing possible support and could turn any day now. Bonds seem to have no support and the 10 year note rate has risen almost to 4.4% now. The U.S. dollar could weaken and help gold prices.
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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