Market Commentary: New Highs Set, Small Caps Lower, Volume Falling

Written by Gary

By 11 am the SP500 tried again to best its opening high (it did by +0.18) but couldn't move higher and traded sideways in a tight narrow band before heading down. All of the other averages remained in the red not even coming close to the unchanged line.

By noon all that had changed as the SP500 had melting up higher along with the DOW posting new highs. The small caps had eased up to the unchanged line as the volume fell and then the markets eased back fractionally. Hang on it could get worse.

Our medium term indicators are leaning towards sell portfolio of non-performers at the midday and the short-term market direction meter is bullish. We remain mostly, at best, negative and conservatively bullish, neutral in other words. Right now now I am getting very concerned any downtrend could get more aggressive in the short-term and volatility may also promote sudden reversals. The SP500 MACDhas turned up, but remains above zero at 21.79. I would advise caution in taking any position during this uncertain period and I hope you have returned your 'dogs' to the pound.

Having some cash on hand now is not a bad strategy as market changes are happening everyday. As of now, I do not see any leading indicators that are warning of a 'long-term' reversal in the near-term. There may be one later in 2015, but any market fluctuations we see now are more of a internal market rectification than a bear market.

Investing.com members' sentiments are 61 % Bearish (falling from 70% and now rising from 33%).

Investors Intelligence sets the breath at 50.0 % bullish with the status at BearCorrection. (Chart Here ) I expect a market reversal at or before ~25.0 should the direction continue to descend.

StockChart.com Overbought / Oversold Index ($NYMO) is at 51.21. (Chart Here)But anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. (Now were are high enough to descend again - watch out!)

StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) is at56.47 %. (Chart Here) The downside decent has reversed, but will it continue to rise above 50%? The next support is ~37.00, ~25.00 and ~15.00 below that. December, 2011 was the last time we saw numbers in the 20's.

StockChart.com NYSE Bullish Percent Index ($BPNYA) is at 54.27. (Chart Here) Below support zone but rising. Next stop was ~57, then ~44, below that is where we will most likely see the markets crash. We are seriously below 44 and need a reversal pronto as it looks like there is nothing to stop the fall until 25 and taking the markets with it.

StockChart.com S&P 500 Bullish Percent Index ($BPSPX) is at 65.60. (Chart Here) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction.

StockChart.com 10 Year Treasury Note Yield Index ($TNX) is at 23.12. (Chart Here)

StockChart.com Consumer Discretionary ETF (XLY) is at 67.96. (Chart Here)

StockChart.com NYSE Composite (Liquidity) Index ($NYA) is at 10,869. (Chart Here) We are above the resistance (10,301) but is this a test of the next resistance at ~10600/800, watch to see if these numbers decline back down. If they don't then there an excellent possibility for the markets going higher now that we have topped 10800. Next stop down is 10600, 9750, then 9250, and 8500.

The DOW at 12:00 is at 17553 down 0.56 or -0.00%. (Historical High 17,566.19)

The SP500 is at 2032 up 1 or 0.07%. (Historical High 2,034.26)

SPY is at 203.43 up 0.27 or 0.13%.

The $RUT is at 1171 down 0.40 or -0.03%.

NASDAQ is at 4627 down 11 or -0.25%.

NASDAQ 100 is at 4155 down 9 or -0.21%.

$VIX 'Fear Index' is at 13.55 down 0.12 or -0.88%. Neutral Movement

The longer trend is up, the past months trend is net positive, the past 5 sessions have been positive and the current bias is mixed.

WTI oil is trading between 79.39 (resistance) and 77.47 (support) today. The session bias is positive and is currently trading down at 79.10. (Chart Here)

Brent Crude is trading between 83.82 (resistance) and 82.16 (support) today. The session bias is positive and is currently trading down at 83.61. (Chart Here)

Gold rose from 1131.92 earlier to 1167.48 and is currently trading down at 1164.80. The current intra-session trend is positive. (Chart Here)

Dr. Copper is at 3.037 falling from 3.048 earlier. (Chart Here)

The US dollar is trading between 88.30 and 87.76 and is currently trading down at 87.88, the bias is currently negative. (Chart Here) Resistance made in Aug., 2013 (~85.00) has been broken and now is support. This support has gotten much stronger since August, 2014 and isn't likely to fall easily.

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