Fool me once… The bulls didn’t fall for the “China Syndrome” today like they did in February. The gap down was bought pretty quickly and the indices ended near unchanged. It’s worth nothing that options expiration is tomorrow so that could be helping things to remain stuck (pinned).
The Nasdaq is working on what at first appears to be a normal pullback in a larger uptrend. Volume has me a little concerned though — it’s increased as price has dropped which is exactly what the bears want to see. That volume action has wiped out the bullish OBV divergence I’ve been mentioning lately. Nevertheless, as long as the short-term uptrend is intact the wind is at the back of the bulls.
The S&P is clearly showing better relative strength than the Nasdaq. It *should* (Dr. Brett’s post is exactly why I’m always putting those asterisks around the word ‘should’.) have pretty good support around 1460 thanks to the two support lines converging there.
I really wish they reported volume on the Russell charts. Its ETF, IWM, had a big volume increase today but I’m just not sure how well that correlates to the actual index’s volume. Knowing the actual volume would help a lot in reading this pullback. Even without the volume the index looks a bit weaker that the Nasdaq. It’s very close to a stochastic sell signal and is close to a test of its trendline.
No changes but the Russell is very close to breaking its 10-day moving average and going into a short-term downtrend.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
| Primary | Up | Up | Up |
| Intermediate | Up | Up | Up |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
This melt-up is too freaky. I’m taking Mr. Livermore’s advice this week.
Nice blog, btw.
Which piece of Livermore’s advice are you taking? “Sell ‘em all, they’re all worthless” is my favorite one. :d