Running Into Resistance?

Tuesday, November 8, 2016

What To Do?

No changes from yesterday.

Short Term:
Short-term bulls should continue to maintain their positions. Stops can be moved to cover costs.
There are no short-term positions to the downside.

Intermediate & Long Term:

Intermediate and 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 from Up to Neutral
Short Term: Neutral.
Intermediate Term: Neutral
Long Term: Neutral

The stock market, as measured by the Wyckoff Wave, traded slightly higher on decreased volume. It closed in the upper half of a wider price spread, in a nearly oversold condition relative to the Technometer. The price spread and volume suggest a lack of supply.

A review of the intra-day waves indicates that today featured a withdrawal of demand.

After a gap opening to the downside, demand did come into the market and the Wyckoff Wave rallied to point V. The rally lasted for two hours and 25 minutes. During the last hour, price spread and volume were greatly reduced. This suggested the withdrawal of demand.

There it encountered supply and reacted to point W. The Wyckoff Wave attempted to rally during the last hour of the trading day, but encountered supply and was unable to make much progress to the upside.

The Wyckoff Wave broke its intra-day up trend channel when it was unable to return to the channel on the rally to point W. The intra-day trend is changed to neutral.

Since yesterday’s wide gap opening, the Wyckoff Wave has been unable to make much progress to the upside. This suggests it will react back into the intra-day trading range and test the lows at points U and possibly S.

The Optimism – Pessimism Index moved sideways. It is in a short-term negative divergence with the Wyckoff Wave when compared with points P and R. It is in an intermediate term negative divergence, when compared with point K

The Force Index reacted slightly and is still producing high negative readings.

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

Today, the Wyckoff Wave attempted to rally and is testing the highs at points R and P. Today’s withdrawal of the market and the return of supply suggests the rally off point S is in jeopardy. This is supported by lack of effort as shown in the O-P Index.

While the Technometer is no longer oversold, the high negative readings from the Force Index continue to suggest it will be difficult for the Wyckoff Wave to continue its advance.

Look for a reaction and a retest of the lows at point S.