Today’s Economic News:
Nice numbers out of Europe again today, very nice from the UK in particular. In the US we will see the wholesale inventories numbers at 10am, looking for a modest gain.
Quote of the Day:
Discovery consists of seeing what everybody has seen and thinking what nobody has thought.
–Albert Szent–Gyorgyi de Nagyraolt
Featured Breadth Chart of the Day:
Reaching for new heights. The Zweig wants to hit that overbought area after breaking out.
Comments and Levels for the Front ES (S&P500 – Emini futures) contract:
The trenders are just one day away from uniting on the bullish side. For today, we have 1687 top and 1674 bottom with both values marking breakout areas from a building consolidation from this week’s nice upside thrust today. We were looking for a selling MiM to help us with our story of a lower high, but instead were teased with a buy side that deteriorated to neutral at best. That does not help our confidence.
What the bears have going against them is volume. There is real longer-term accumulation here and that can be seen with the CVI on one of the charts below which is leading to new highs, that is very bullish. We are now neutral and waiting for the trends to settle one way or another.
On the MiM:
MiM was all over the place yesterday telling us that the market was uncertain and price action confirmed that as the close wasn’t very dynamic. After 3 days of decent selling, I would say this MiM comes in neutral, able to effectively balance the market out by the 3:45pm ET reveal. What is is missing is committed closing buying.
If you want to join the meter readers you can go to: Join the MiM
Comments about TLT (Twenty year Bond ETF):
We are watching 106.50 for a hold and a possible attempt to run to the 108 area. We think there is room for rates to go down still.
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Breadth Charts in Full :
Zweig Breadth Thrust:
Zweig getting a bit of a boost into the Friday Close. We think this morning’s gap open could be a buy.
Cumulative Volume Index:
Upside volume has stalled out.
Number of NYSE issues trading ABOVE their 40 day moving average (40DPI):
There was positive breadth on Friday. We need to watch as the broader market might just be getting solid enough support to form a foundation for the bulls to leap from. If you are short and want to be protective, watch the Russell 2000 a/d lines and see if risk is in favor. It doesn’t have to be positive, just leading.
New Highs / New Lows ratio chart :
New Highs not suggesting any strengthening.
Short Term Trender – McClellan Summation Index:
Long Term Trender – Cumulative 4-week Highs – Lows (the fat lady):
Thank you for Reading –
Marlin aka RedlionTrader @redliontrader
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