Weakening, But Not Rolling Over

 With technical indicators weakening, you would think we would be headed down, and for two days in a row it looked like we were, but afternoon rallies brought us right back up. In the short term, we appear to have a pivot point at 1185, with support about 1060, making the upper boundary about 1210.  Despite the weak indicators, we aren't getting the high volume churning you typically see at tops,and distribution has been relatively low.It's possible we may go sideways as the indicators head down, which would be auite bullish when they turn up.

       

 The Dow industrials look worse, but again, volume is not very high. RSI is still above 50, so, while weakening, is not indicating an imminent collapse. This could be in the process of pulling back to a rapidly rising 50dma, which, if it holds, will be yet another bullish indication.

 The Nasdaq 100 is an entirely different market. Yes, it is overbought, but shows no sign at all of weakening,  has had very little distribution, volume is increasing on the upside, and it is well past the April high. If the Nasdaq is topping out, it sure isn't telegraphing it here.

Here, however, it does look like it is weakening, although it may just be working off some of the overbought condition. This is the percentage of stocks above the 50dma, and is becoming one of my favorite indicators since it is a percentage and has been pretty reliable in the past. When it gets over 70 it tends not to stay there too long before coming back down, but won't indicate that we are in a correction until it gets below 40. The trouble is, at least in the recent past, that transition can happen pretty quickly.

I've been meaning to do some historical research into the NYSE to see if I can come up with more exact levels here, since the presence of so many ETF's possibly skew the data. It is, however, weakening as well, and it appears 50 and 30, while not exact, may be close enough to give us an idea of what is going on here. This is still stronger than the Nasdaq, but not by nearly as much as it was back in July, and we could see a big drop here before we see it in the Nasdaq. This will be interesting to watch.

Th market is clearly having trouble going higher, but that may be due more to outside issues, such as elections and Fed interference. I think by Wednesday or Thursday of next week the picture will be a lot clearer. By the way, posting may be sporadic over the next few days as my granddaughter is due to be born sometime in the next few days.

I will have the new highs update shortly.