No changes from yesterday

Click Here For Wyckoff Wave Chart 05-22-2016

Short Term:

Their are no short-term opportunities to the upside.

Although the Wyckoff Wave may continue to react, it appears to be close to a support level and any new positions to the downside would have a bad profit risk ratio.

Intermediate & Long Term:

Intermediate and long-term bulls should maintain existing positions.

There are no intermediate or long term opportunities to the downside.

Market Trends:

Intra-day: Down, and in an overbought position relative to the trend.

Short Term: Changed to Down

Intermediate Term: Neutral

Long Term: Neutral

The stock market, as measured by the Wyckoff Wave, experienced and intra-day failure to the downside. It closed, on decreased volume, in the middle of a narrower price spread, in a slightly overbought condition relative to the Technometer. The intra-day failure suggests a lack of demand.

A review of the intra-day waves confirms the above. After a small gap opening to the downside and a brief 5 min. rally, supply came into the market and the Wyckoff Wave to reacted to point F.

It then spent the rest of the day in a poor quality rally to point H, before supply returned and the Wyckoff Wave reacted near the end of the trading day.

The Wyckoff Wave continued in its overbought condition relative to its upward trend channel. It is also encountered supply at point E, G and H.

While today’s performance was rather lackluster, the supply the Wyckoff Wave has encountered, at the top of this brief sideways move, continues to suggest it will react back into the intra-day down trend channel.

The Optimism – Pessimism Index rallied slightly. It remains in a short term negative divergence with the Wyckoff Wave when compared with point V.

The Force Index reacted slightly and is producing moderate negative readings.

Tomorrow, the Technometer will open in a slightly overbought condition.

Today, after a brief intra-day reaction, the Wyckoff Wave rallied slightly. As it approached the supply line of the short-term down trend channel, the Wave encountered supply and reacted slightly.

Today’s lack of demand suggests the Wyckoff Wave will react and test the support line of its trend channel. The support line would also be in the area of points U and S.

So far, the Wyckoff Wave has not experienced significant supply that would suggest it will react deeply into the trading range. This is not consistent with the overbought Technometer. That inconsistency was discussed in Sunday’s blog post

Tomorrow could be an interesting day. If the Wyckoff Wave is going to put in a significant reaction, supply needs to become strong and sustained. If it continues to be moderate and sporadic, the support at points U and S scenario has an increased probability of success.