Maintain positions…

Click Here For Wyckoff Wave Chart 06-10-2016

Short Term:

Their are no short-term opportunities to the upside.

Short-term positions taken to the downside, should be maintained.

Intermediate & Long Term:

Intermediate and long-term bulls should maintain existing positions. However, this is a good place to close trades that have reached objectives and eliminate any underperforming positions. Cash should be held in preparation for ending action and a move to the upside.

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

Market Trends:

Intra-day: Changed to Down

Short Term: Neutral

Intermediate Term: Neutral

Long Term: Neutral

The stock market, as measured by the Wyckoff Wave, traded lower on increased volume. It closed in the middle of a wider price spread, in a slightly overbought condition relative to the Technometer. The price spread and volume suggest the presence of supply.

A review of the intra-day waves indicates that, while some demand was present, today was a supply day.

After a wide gap opening to the downside and a 20 min. follow-through to point C, the Wyckoff Wave put in a poor quality intra-day rally to point D. While some demand was present early in the rally, it was quickly withdrawn.

Good supply returned and the Wyckoff Wave reacted to point F. There, it attempted to rally, but made little progress until demand returned during the last 45 min. of the trading day.

The intra-day trend is changed from neutral to down. A new trend channel has been drawn in red.

It is important to note that the intra-day rally to point D was unable to reach the trend channel’s supply line. This suggests relative weakness and, despite today’s late demand, suggests the intra-day down trend will continue.

The Optimism – Pessimism Index reacted. It remains in an extremely overbought position relative to its upward trend channel. The negative inharmonious action, when compared to the Wyckoff Wave at point V, remains in place.

The Force Index reacted and is producing low positive readings. It continues to have a mitigating impact on the overbought Technometer.

On Monday, the Technometer will open in a high neutral condition.

Today, the Wyckoff Wave continued its reaction off point A. However, the price spread, while wider then on Thursday, was relatively narrow. This suggests the presence of some demand.

It also suggests that while the reaction is expected to continue, it is not expected to last a long time or be particularly strong.

Today’s market action also suggests that the Wyckoff Wave could attempt to rally and test the high at point A. If so, the test is expected to be successful and the Wyckoff Wave will again react.

These conclusions continue to be supported by the overbought Technometer and the changes O – P Index’s negative inharmonious action, which will become a negative divergence if the reaction continues, with the Wyckoff Wave.

The Force Index’s positive readings are shown in the poor quality reaction off point A.

On Monday, the Wyckoff Wave could continue to react or begin to test the high at point A. Regardless, point A appears to be the new top of the trading range.

The reaction scenario that has the Wyckoff Wave testing the lows at point Z, U and S and possibly returning to the short-term down trend channel, continues to have the highest probability of success.