Today’s climb out of the pit at the open may foretell more upside Tuesday, but, like it seems everyday these days in the market, one has to instantly say “and maybe not.”
On my swing signals, price gave a buy today while breadth and volatility remain on sells, and the all important long-term breadth continues to decline. A price uptick of late, even without backup from the internals, seems to be all the bulls need to at least bounce to the indexes.
Throw in short-term breadth and volatility being down three days in a row and one begins to suspect a bigger bounce is near. If it can turn long-term breadth up from its deeply oversold level…well, maybe even a rally to new highs everywhere.
Looking around the market, there are some interesting stock moves. Like how healthy is this market when GE is in free fall? You’d think it was Kodak. Or RACE dropping twelve points off an all time high in seven trading days. Did Ferrari flat run out of gas? Actually I think RACE may be a winner the rest of this week.
My nifty-50 stock list continues to slop around in middle ground. A 40-plus overbought will probably not be a sell but a 40-plus oversold will be a big buy sign for a rally to wherever.
On the crazy plus side, TSLA bounces 15 points today after falling 80 from a double-top all-time high. The banks all had their hands up. Double-digit Reit stocks were up. Why no one buys those dividends on a steady basis is beyond me? And coal stocks, living on the never-ending hope Trump will dish the sector a truckload of taxpayer cash. I was going to say “undying hope” but switched to “never-ending” because the coal companies are dying no matter what.
Solar stocks, on the other hand, have again been leaders on this latest refusal of the market to go down hardly at all. See the chart of FSLR below, up 29% since rising up out of the tight Darvas box and soaring into the sky in little over a month (might be time to lock some profits there).
SWING TRADING SIGNALS:
LONG-TERM BREADTH: Sell (Day 20).
PRICE: Buy. (Day 1).
SHORT-TERM BREADTH: Sell. (Day 3).
VOLATILITY: Sell, (Day 3).
SPY CLOSE – 258.53
QQQ CLOSE – 173.97
CNN MONEY’S FEAR AND GREED INDEX: (59, rising, neutral level).
NIFTY-50 STOCK LIST: 22 Buys; 8 Overbought, 9 Oversold, 7 new buys today, 5 new sells.
(click on the chart for a larger view)