Sterling Investment Services look at the market activity during the Thanksgiving holiday shortened trading week, and our thoughts for today’s markets, as well the possibility of the market resuming its downward trend. Additionally we have updated our support and resistance levels for the major market indices that we follow.
Sterling Investment Services look at the trading activity from Wednesday’s pre-Thanksgiving market and our thoughts about today’s market. We also take a look at the rally over the last couple of trading sessions, and provide our thoughts on whether it is a legitimate market rally, a retracement of the recent downward movement, or just a bump in the road on the move lower. Our chart is worth checking out.
Sterling Investment Services look at Wednesday’s market sell off and our thoughts about Thursday’s market. In this morning’s market commentary we have updated our support and resistance levels on the Dow Jones Industrial Average, the Dow Jones Transportation Average, and the NASDAQ 100 Index ‘NDX’. We have also included a chart on the Dow Jones Industrial Average for your review.
In today’s edition of the Sterling Market Commentary I take a look at the results from Thursday’s market, and provide my thoughts on Friday’s market activity. Additionally I have now initiated coverage on the NASDAQ 100 Index ‘NDX’. I have included chart on the NASDAQ 100 Index ‘NDX’ for our readers review.
A Few Thoughts Wednesday’s Market: The Dow Jones Industrial Average closed yesterday at 13,102.53. In doing so, it clearly broke a supporting trendline that started in early March of this year. I have inserted a chart on the Dow Jones Industrial Average below for you to review. I think we are starting a new short to intermediate term downward trend. I believe that there is a very good possibility that we could see the Dow Jones Industrial Average continue to move lower and test its 200 day moving average at 12,908.33 on a closing basis. I should also point out that today is a rather quite day for economic news and unless there is a major earnings miss, then it is reasonable to expect a bounce in the market today. However, initial and continuing jobless claims are due to be released Thursday morning, and we could Thursday’s economic announcements could spark a move either way in the market. My guess is if we see a rise in initial jobless claims, then the market will probably head back lower. (Please see the Chart on the Dow Jones Industrial Average we have included in today’s blog)
A Few Thoughts on Monday’s Market: The overall market is showing considerable weakness, with the high tech sector in an outright bearish trading pattern. A lot of the weakness in the high tech sector can be attributed to a pull back in the shares of Apple, Inc. ‘AAPL’. However it is not just Apple that is causing the weakness in the high tech sector, there is considerable weakness in the WinTel world, those high tech companies that are focused products utilizing either Microsoft or Intel architecture. I think that the stock market is signalling a pullback in the U.S. Economy. I also think that this signal would be a lot louder and clearer if it was not for the Quantitative Easing programs of the Fed and their market manipulation effects. In looking at the charts from Friday’s activity I noticed that the M.S. Consumer Index ‘CMR’ had not yet broken its recent upward trendline. I am keeping an eye on the ‘CMR’. If we have another couple of down days and this index breaks its upward trendline, then I see this as a potential confirmation that the U.S. Economy is headed back into a recession…..
A Few Thoughts on Wednesday’s Market: In looking at the charts from yesterday’s trading activity I was struck by the apparent breakdown and weakness in the vast majority of the charts I looked at. While there is a good possibility several of these indices could bounce from these levels, another couple of down days will break the upward trend that has been in place since early summer and signal the start of a new downward trend. The charts of the various sector indices I track can be grouped into 3 basic categories. The 1st being the capitalization weighted tech indices that are very heavily weighted with Apple, Inc. ‘AAPL’. Due to the excessive weighting of Apple within these indices as Apple has moved lower, these indices have been dragged lower at a sharp paces. Basically a kind of “Live by the Sword, Die by the Sword” situation.
In today’s Sterling Market Commentary I look at a couple of pressures that I see facing the market. We also take a look at the Dow Jones Transportation Average and its influence on the market.
The overall market moved sharply higher in a broad based move that saw basically every index I track move higher on the day. Thursday’s move in my opinion was nothing more than a bounce from the previous move lower, and was probably exaggerated to the upside by comments from the Fed about the possibility of continuing quantitative easing and greater than expected jobless claims. It is a sad state of world affairs where comments about maintaining emergency level fiscal stimulus is having such an impact over 3 1/2 years after the financial crisis of 2008. It is also a sad commentary on the market when so much of the activity is controlled by computers trolling the news wires for headlines to base their trading decisions on. Think about for a minute. This creates a market where the activities of a young writer, with no market experience at one of the networks or newspapers could influence the direction of the market by their mood of the morning. It also is a sign that fewer and fewer of the market participants are actually able to think for themselves. This can’t be a good thing in the long run.
A Few Thoughts on Wednesday’s Market: In looking at the charts from Tuesday’s trading activity I noticed a couple of items of significance. The 1st being that volume increased significantly on Tuesday. Heavy volume on the way lower is always considered a bearish trading signal for the markets. The other significant item I noticed was that the very vast majority of the indices and individual stocks I looked at broke through support during their moves lower. This break below support was significant enough that even a 100 point move higher in the Dow Jones Industrial Average will not get many of these stocks back above those support levels, which are now upside resistance levels.
While early morning futures are looking positive, I do not see any move higher today being much more than a bounce before the market moves back lower. I am going to be looking for a covered put position to enter for this morning’s trade.
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