After a shaky morning the bulls were able to keep the indices positive or near unchanged. So the oversold bounce that started last week is still intact. The trend table is looking better now that all of the short term trends are up or lateral but I wouldn’t sound the all-clear just yet. First I’d like to see the indices climb back above or into the gaps from earlier this month. That means the Nasdaq above 2541 and the S&P above 1200. I’d like to see that happen on decent volume too, so if we creep up there on light volume this week I’ll be really skeptical of that holding up after the holiday. Likewise, I’ll likely view any light volume downside moves as noise, especially if the indices hold above last week’s lows.
I hate to keep harping on the financials but I think it’s noteworthy that XLF made a lower low today and showed poor relative strength. The action in the financial sector still seems like a bad omen to me…
Some recovery in the short-term trends…
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Up | Up | Up |
| Intermediate | Up | Up | Up |
| Short-term | Up(+) | Lat | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
