While it's still too soon to say how the day will turn out, it is clear that,
regardless of where we close today, that the market is just plain strong. The Nasdaq
this year has been impressive to say the least, and it looks like we could keep going
at this pace for a few more weeks.
After Monday and Tuesday, and the corresponding crosses under the 10 and 20 day
moving average lines over those two days, we did have some mild concern. We could
have potentially dropped to the lower support level at 1880. We probably would have
stopped and made a bullish reversal at that point (as we have for the last seven
months), but at least you would have known that the dip wouldn't be a major blow. But
we didn't even make it that far down. The crosses under the two key EMA lines were
sell signals, yet we immediately followed those signals with major advances (so far)
today. The Nasdaq is finding support at the 20 day line, and surmounted the 10 day
EMA line just a few moments ago. Simply amazing.
BUT, you shouldn't be shocked if we do come back all the way down to the support
line, nor should you be worried. It would only be about a 3 percent drop.
So with that, we remain bullish, heading into the most bullish period of the year.
The corrections are mild and short-lived, and we keep making higher highs. The trend
lines are strong, and with the presidential-race-campaigning being taken up a notch,
you can bet that the White House will do plenty to keep things going. This is likely
to be the case until the end of the year, when we may finally find ourselves in the
midst of a meaningful correction.
NASDAQ CHART
S&P 500 COMMENTARY
The same commentary above applies to the S&P 500 - even the best of sell signals
don't lead to dips. The S&P 500, supported at the 20 day EMA line, didn't even make
it down to its lower support level today. Like we mentioned for the Nasdaq, we may
not make down that far if today's srength holds up. And even if we do revisit the
lower support line, it's not that big of a deal. The S&P has been in this bullish
channel for a while, and there's not any real evidence that it will break out of it
anytime soon.
But we're using the weekly chart today, with 9 bar and 13 bar (2 month and 3 month)
moving averages. The trend is apparent here too - we're going higher, and even the
threats of heading lower are minimal. These threats would be a close under either of
the key EMA lines. Since March, we have yet to close under the 13 week moving average
(blue), and we've only closed under the 9 week average twice (and quickly reversed
those two dips the following week). At this point, you may find that the weekly
charts are far more useful, even if you're an active trader. The reason is that the
day to day volatility has created some strong sell signals (such as Monday's and
Tuesday's bearish crossovers), but even the daily trends are quickly overpowered by
the bigger, weekly (and now monthly) trend. As always, no matter what you're
timeframe is, fighting the trend is a tough path to follow, and the trend right now
remains a bullish one.
S&P 500 CHART
BOTTOM LINE
Thursday should be a pretty active day, with the trade balance and initial claims
figures coming out at 8:30 a.m. EST. It will be interesting to see if the initial
claims come in anywhere near as low as last week's 348,000. Friday is going to be
even more throttled, with retail sales, PPI, capacity utilization, industrial
production, and the Michigan Sentiment Index all being announced. The retail sales
figure could be big, as the entire sector is reporting that sales plans are being met
or exceeded now that the colder weather has set in.
Se não receio o erro é porque estou sempre pronto a corrigi-lo
There's no bull side and no bear side. JUST THE RIGHT SIDE!
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