No Changes From Yesterday

Thursday, September 8, 2016

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What To Do?

Short Term:
There are no short-term opportunities to the upside.

Short-term bears who hold positions to the downside should maintain them. In addition, new short positions can be considered.

Intermediate & Long Term:
Their are no intermediate or long term opportunities to the upside.
Long-term positions to the upside should be maintained.
There are no intermediate or long term opportunities to the downside

Market Trends:

Intra-day: Changed to Neutral
Short Term: Neutral.
Intermediate Term: Neutral
Long Term: Neutral

The stock market, as measured by the Wyckoff Wave, traded slightly higher on increased volume. It closed in the upper half of a very slightly wider price spread, in a neutral condition relative to the Technometer. The price spread and volume suggest the presence of demand.

A review of the intra-day waves indicates today was a lack of demand day.

After a gap opening to the downside, yesterday’s supply continued and the Wyckoff Wave reacted to point U. The reaction only lasted for 20 min. and then demand returned. This helped the Wyckoff Wave rally to its high for the trading day at point V.

After a brief reaction the Wyckoff Wave moved sideways for the rest of the trading day. This intra-day sideways move lasted for four hours and 20 min., but the Wyckoff Wave was only able to gain 36 points.

During this sideways move, on several occasions the Wyckoff Wave attempted to rally, but demand was withdrawn and the Wyckoff Wave could not make any progress to the upside.

On an intraday basis, the O-P Index is in harmony with the Wyckoff Wave.

Today’s market action continues to indicate relative weakness. After today’s attempts to rally failed, the Wyckoff Wave continues to be vulnerable to react and test the lows at point E on the intra-day line chart.

The Optimism – Pessimism Index reacted. It remains in the upper portion of its upward trend channel. More importantly, it continues in a negative divergence with the Wyckoff Wave, when compared with point E.

Tomorrow, the Technometer will open in a high neutral condition.

Today, the Wyckoff Wave made a poor attempt to rally and failed, as demand was withdrawn.

During the last five trading days, beginning with the low at point I, the Wyckoff Wave has only gained 668 points or 1.6%. The move has also been on relatively lower volume and sustained price spread.

While the Technometer has returned to a high neutral condition, the significant negative O-P Index divergence continues to suggest it will be difficult for the Wyckoff Wave to put in any significant rally.

At this point, it is quite doubtful that in the immediate future the Wyckoff Wave will fill the gap formed by the reaction to point G. Instead, the reaction back into the trading range scenario continues to have the highest probability of success.

Today’s market action continues to suggest short positions can be taken and those existing should be maintained.