Words to live (trade) by above. The Nasdaq broke through Thursday’s low and thereby invalidated the support of Thursday’s hammer. The S&P 500 is just over a point away from the low it made on Thursday. So it looks like tomorrow will be a big day as that level will probably get tested — unless the inflation data saves the day.
After a mixed start to the day – the Dow was in positive territory for a good portion of the morning – things got really ugly in the afternoon. The Dow closed under its 200-day moving average for the first time since November, the S&P is now negative for the year, breadth was horrible at 4-to-1 negative on the Nasdaq, etc.
T2108 is back near its oversold level of 20. It closed at 20.58 today. Its cousin, $SPXA50R, closed at 24.20.
Somehow I managed to not make a single trade today. I thought about shorting the Qs but the Dow’s early strength had me a little worried. Every individual stock I thought about shorting was already down big. I don’t like chasing stocks on the way up and I really hate chasing them down. So it was an easy decision for me to stand aside today. I wish I’d shorted the QQQQ but hey, you can’t catch every move.
I’m sure tomorrow morning will be very active since the PPI data will be out and expiration tensions should be beginning to kick in.
Since the Nasdaq’s 200-day moving average is just beginning to slope downward I’m changing its primary trend to down today. I’m also changing the S&P and Russell’s primary trends to lateral.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
| Primary | Down(-) | LA(-) | LA(-) |
| Intermediate | Down | Down | Down |
| Short-term | Down | Down | Down |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
LA Indicates a Lateral trend
How has the handy/dandy T2108 been acting lately?
As handy & dandy as ever. Last month’s bounce coincided with a break under 20 and it’s sitting less than a point above 20 right now. That’s a big part of why I dont want to initiate shorts here.