Written by Gary
Averages slipped back into the red after a brief moment in the green peaking around 10 am. This time the volume was mostly red and heavy as some investors took their profits.
By 12 noon the decent sea-sawed, rising giving brief hope the averages were moving up again only to fall further. The small caps are off -0.6% with the large caps following at a distance, but session guidance is not available.
More than likely we will end up in the red, but future sessions seem to be an enigma as technicals depict a definite rounding and weakness, but some analysts are saying this is just a consolidation before moving higher.
Our medium term indicators are leaning towards sell portfolio of non-performers at the midday and the short-term market direction meter is Bearish. We remain mostly conservatively bullish, neutral in other words. Right now now I am getting very concerned any downtrend could get very aggressive in the short-term and volatility may also promote sudden reversals. The SP500 MACD has turned flat, but remains above zero at 24.29. 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 62 % Bearish (falling from 70% and now rising from 33%).
Investors Intelligence sets the breath at 52.9 % 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 15.02. (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!)
