Commentary: Paul Ebeling on Wall Street

Commentary: Paul Ebeling on Wall Street

$DIA, $SPY, $QQQ, $VXX

The internals and sentiment continue to suggest a pullback in here, but leading stocks keep finding a way to rally or hold their gains and support while waiting for money to rotate back their way so they can extend The Trump Rally.

So, as long as the market has plenty of leaders setting up to move higher and moving higher, the internals and sentiment will take the back seat.

But, pay attention, be alert to leaders breaking down, Caution.

However, this move can  continue for quite some time after the internals start to flash Caution ahead.

In this record territory, it is hard to find plays in good position for Northside moves, and that speaks to the tone of this rally with many stocks either having broken higher recently or are in continuing moves that are not good entry points.

Either that or they are testing and do not yet look ready to make the new break North. That does suggest that the Northside is getting extended, but it does raises questions as to how much gasoline is in the tank to drive this market further North. Again, pay attention, caution is Key in here.

If good stocks that are seeing pullbacks now, do not bounce due to lack of bids, then break near term support and do not recover on the close, well that is a solid indicator combined with the internals and sentiment, that the rally is running out of gas.

Unless there is a fast break lower, you have to watch where the leaders testing support close. A reach lower has been bought in this market, and many testing leaders are at the point where they often show 1 more dip then a reversal North come on.

This week’s Wall Street action will be very instructive as to the rally’s continued power.

Most S&P 500 sectors are still in solid uptrends and have not started building Tops. So, to play them to the Southside is a guessing game.

Notably not many good stocks  have not set up Southside patterns in here. When they do and they will, then can put some protif money to
work to the Southside.

Meantime, always take what the market gives, as the name of this Wall Street game is to make money.

 

The Bulls Vs The Bears

Sentiment Indicators

VIX: 11.49; -0.27.

VXN: 12.07; -0.67

VXO: 11.27; +0.73

Note: Last week saw the situation where volatility rose with market gains. That is worth noting in the Bearish signals log,  though VIX overall remains very low. At this point, upside VIX sessions are more an indication that there can be a near term pullback. This is in contrast with the situation where VIX is  trending higher as the market trends higher. A steady uptrend in VIX  accompanying a steady uptrend in the market indices is an indication of a longer term, market Top setting in.

Put/Call Ratio (PCR) CBOE: 0.93; +0.04

The Bulls Vs The Bears

The Bulls backed off the cycle high, but held over 60%, The Bears climbed back to marks seen 3 weeks ago.

The Bulls are at: 61.8 Vs 62.7 last

The Bears are at: 17.6 Vs 16.7 last

 

Support and Resistance

DJIA close: 20,624.05

Resistance

None

Support
20,126 the Jan 2017 high
20,101 a Jan 2017 high.
19,994 a Jan 2017 high
The 50-Day SMA: 19,971
The 50-Day EMA: 19,885
19750 the Jan 2017 low
The 200-Day SMA: 18,673

 

S&P 500 close: 2351.16

Resistance

None

Support
2301 a Jan 2017 high
2299 the Y 2016 trendline
2280 a Jan 2017 low
2278 the Dec 2016 high
The 50-Day SMA: 2279
The 50-Day EMA: 2276
2213 the Nov 2016 high
2194 the Aug 2016 high
2175 the Jun 2016 high
The 200-Day SMA: 2173

 

NAS Comp close: 5838.58

Resistance

None

Support
5661 a Jan 2017 upper gap mark
5601 a Jan 2017 lower gap mark
The 50-Day EMA: 5580
The 50-Day SMA: 5564
5559 the Y 2016 trendline
5404 rhe Nov 2016 high
5340 the Oct 2016 high
5288 the Sep 2016 high
5271 the Aug 2016 high
5232 the Y 2015 high
The 200-Day SMA: 5220

Have a terrific week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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