NASDAQ Composite (.IXIC) tech-heavy index’s biggest one-day gain in five months
The Nasdaq Composite COMP, +2.65% surged 2.4% in afternoon trade, with the tech-heavy index’s biggest one-day gain in five months producing panic-like buying activity.
The Nasdaq exchange’s Arms Index is a volume-weighted breadth measure that tends to fall below 1.000 when the stock market rallies, as the ratio of of advancing/declining volume tends to increase more than the ratio of advancing/declining stocks, as buyers tend to become more aggressive than sellers.
The Nasdaq’s Arms has dropped to 0.454, with declines below 0.50 viewed as indicating panic-like buying. That would be the lowest reading since it fell to 0.45 on Jan. 4, when the Nasdaq Composite soared 4.3%.
In afternoon trade, the number of advancing stocks outnumbered decliners by margin of 2.84 to 1 while the volume of advancing stocks outnumbered declining volume by a ratio of 6.23 to 1. Meanwhile, the S&P 500 SPX, +2.14% rose 0.9% and the Dow Jones Industrial Average DJIA, +2.06% gained 461 points, or 1.9%, and the NYSE Arms fell to 0.670.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 7,733.88.
The projected upper bound is: 7,758.39.
The projected lower bound is: 7,291.22.
The projected closing price is: 7,524.81.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 29.5047. This is not an overbought or oversold reading. The last signal was a buy 0 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 40.39. This is not a topping or bottoming area. However, the RSI just crossed above 30 from a bottoming formation. This is a bullish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 0 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -91. This is not a topping or bottoming area. The last signal was a buy 0 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 23 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed up 194.098 at 7,527.117. Volume was 9% above average (neutral) and Bollinger Bands were 40% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 7,583.75 7,856.61 7,520.14
Volatility: 24 19 26
Volume: 567,481,216 540,710,080 586,283,776
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NASDAQ COMPOSITE is currently 0.1% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of .IXIC (mildly bearish). Our trend forecasting oscillators are currently bearish on .IXIC and have had this outlook for the last 17 periods.