Monthly Archives: June 2017

Not Much Damage

We’ve had another week where the Nasdaq 100 (NDX) was volatile and suffered a bit of damage, but sentiment for the S&P 500 Index (SPX) is still holding up. As long as 7 day momentum stays above it’s current trend line the market should continue to advance.

 

A lot of people are looking up to 2500 as the next target for SPX. Of course, they’re all waiting to see if 2400 holds too.

 

Breadth is showing improvement mainly due to a decrease in the bearish count.

 

Conclusion

Everyone is waiting to see if 2400 on SPX hold. However, they’re waiting with optimism that volatility in NDX won’t spill over into SPX.

 

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Still Bullish

Even with Friday’s ugly market action, investors and traders on Twitter remain bullish. The daily sentiment and momentum indicator for the S&P 500 Index (SPX) had a positive print on Friday. Seven day momentum remains in an uptrend and it’s likely the market will as long as that uptrend is intact.

 

2450 on SPX is a resistance level that has been tweeted since January. Once the market passed 2400, then 2450 was the next likely place to pause. It looks like we’ve got that pause. Support is at 2400 and 2350. I expect the market to hold somewhere in that area unless the trend in 7 day momentum is broken to the downside. One other thing of note, traders’ tweets didn’t show any fear on Friday. Notice the lack of tweets calling for prices below 2400 on SPX.

 

Breadth is repairing itself with the bullish count rising and the bearish count falling. This is another indication that we’re likely seeing a pause rather than an intermediate term top.

 

Conclusion

Bullishness still reigns. Until we see fear in traders’ price targets, a significant decline in the count of bullish stocks, or a break of the confirming trend line in 7 day momentum we should expect the market to move higher (even if it needs to rest for a week or so).

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