The Either/Or Market Remains Undefeated
The Market
It was another sloppy day in the market, but breadth stayed positive for most of the day. In fact, the equal-weight S&P, RSP, has now been green for eight of the last nine trading days, while the SOX has been red for five straight days. Yes, the Either/Or Market remains undefeated.
You know what else has been green for eight of the last nine days? The Utes. They are into some resistance and overbought now. I am still a fan, but if you are trading them, some profit-taking is in order.
I would have thought with the bonds rallying, the market would have been more solid, instead of sloppy. But the Russell continues to toy with the 200 DMA. And the Bank Index failed right at resistance.
Nasdaq’s McClellan Summation Index continues lower while the NYSE’s is trying to turn upward. I think the most important statistic of the day was that while the NYSE’s new lows have been contracting Nasdaq’s have not. Today Nasdaq had 510 new lows. On September 28th there were 535, but Nasdaq was nearly five hundred points lower.
The SOX did not quite get to the uptrend line I drew in, but it did close near the high of the day. After five down days, I can see a rally, but now 12,500 looms as resistance.
New Ideas
Back in July I recommended Gilead ($GILD) and then in September I said I wanted to take some profits. The stock has done a lot of up and down (142-152), but notice that it seems to have formed a head and shoulders top, or the potential for one. Consider this a reiteration to take some profits.
Today’s Indicator
The McClellan Summation Index is still trying to turn upward. It would need a net differential of -1100 advancers minus decliners on the NYSE to halt the rise. I just wish we would see it in the charts.
Q&A/Reader’s Feedback
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QXO ($QXO) is oversold and has been in this channel for months. A rally to 12 fills a gap and 12.50 gets to the top of the channel so let’s call it 12-12.50.
Comcast ($CMCSA) had better rally over 21.50 or this oversold condition will be wasted by not recapturing the breakdown.
AGNC ($AGNC) is oversold but if it can’t get itself up and over 8.90-9 it will have wasted the oversold condition and window to recapture the breakdown.
The break in Annaly Capital ($NLY) looks like it got the stock oversold enough to rally but that’s the best I can say for now. 19-19.50 seems like resistance.
Palo Alto Networks ($PANW) is overbought but hasn’t done anything wrong yet except get to some resistance. I would not be surprised to see it come down and tag that support area from those two lines: 360-380.
There is a lot going on when it comes to the chart of CrowdStrike ($CRWD). Is that an island reversal (arrow) last week? It has support at this 260 area, so if that gives way, I’d get concerned.
$EFA, an ETF to be long the EAFE stocks, has broken the blue line, which means the uptrend since May is done unless it can recapture 105 in the next week or so. I’d watch to see if it can do that because if it can’t, then the black line comes into play.
