There wasn;t much of anything surprising about today. The NFP numbers sucked about as much as anyone with any brains expected, the market, which was tipping yesterday, slid down today, and voluem shrunk to near nothing as the long weekend loomed. I mentioned earlier this week that breakouts from wedge formations are frequently in the wrong direction, and it looks like that may be the case here, although so far the descending trend line has not been broken yet. We will have to wait and see how it behaves here.
We have pretty clear support and resistance now on the weekly chart, and a mid point at 1170. Once we broke through that earlier this week, the selling pressure built up to the point where we ended up just about where we started the week. Now we might see is the reverse situation occurs if we approach 1100, but if MACD histogram is as accurate as it has been the last 3 years, we may not be heading there. Normally a reversal in the histogram is good for a pretty decent move in the direction of the reversal, and it rarely gives false signals, so I;m not convinced we are going to collapse here, at least not yet.
The Nasdaq had a slightly better week, but is in about the same technical shape. Since it is above the middle point between support and resistance, it is possible we will get another bounce here, and with a rising MACD histogram it would not surprise me.
The Dow industrials are also finding support at that middle line. So far, so good here.
This doesn't look good. The Dow transports are really lagging behind, and get smacked pretty hard as soon as they poked their heads over that middle line.
The same thing happened to the Russell 2000, only here it looks a lot worse. MACD histogram did rise, so that may save the day here, but it really doesn't look very good.
I will be looking for volume next week, but jufging from the last couple of September, it might not cpme in right away. The golden selling opportunity may be gone for now, so there is a possibility the market will be run up in another bounce. I think the stronger possibility, though, is a move down.
I will have the new highs update shortly.
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