It was a choppy day as the market tried to figure out if it liked the Irish bailout and the Black Friday results. We finished on a high note with afternoon strength but overall the day didn’t give us much new information. The indices are still consolidating as they have been for at least a couple of weeks. Perhaps they’re building strength to get back above the spring highs but the technical patterns I’m seeing make me think that a downside move is more likely. The S&P looks like it just wants to drift sideways while the Nasdaq appears to be printing a bear flag. If it does breakdown it would still need to break its 50-day moving average before I’d be concerned and/or an all-out bear.
When I last posted GOOG almost two weeks ago it was deeply oversold. It’s now worked off that oversold condition but it’s made no progress and is still in danger of filling that October gap. The 50-day moving average is the last obvious support before it hits that air pocket.
| 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.
