Weekly Market Update: Sideways

The market ended mixed last week. Three indicators are in the red with the Dow performing better than the NYSE. That is a defensive sign as the DOW is blue chips with stability. It's possible we are going to move sideways for a little while.

Some interesting reading:

• DecisionPoint Weekly Wrap 
• Dr. Wish is looking to see what happens with QQQ this week. Will the uptrend continue or will it break down?
• Fear and Greed index is at neutral
• Investor's Business Daily (IBD) - a look at the week to come and stories on Amazon's purchase of Whole Foods and the DOW moving up. 

Let's see what the charts tell us this week.

Weekly Market Update - Tech Stocks Pull Back

This week we saw the NasDaq pull back. Two of the indicators went red:

1. NYSE AD vs NYSE 52 HL Differential
2. Divergence: DJIA vs NYSE A-D 

Dr. Wish has a nice post about the pull back. Bloody Fridays often lead to Bloody Monday Opens.

Let's see what happens today. Honestly, we are due for some sort of pull-back. That's why I like protective stop losses and calculating risk prior to entering into a position. 

Weekly Stock Market Update: Full Steam Ahead

Stocks continue to advance and all indicators are green, with the exception of the dividend ratio on the Dow, but I think that indicator may need adjusting for the era we are in with low interest rates.

If we take a step back and look at the markets from a macro view and use the 10 month moving average (MA) compared to the 30 month exponential moving average (EMA) on each of the major indexes, we can see a nice picture of where we are. When the 30 EMA crosses over the 10 MA it is bad news, however it the shorter term MA is above the longer EMA, then it is good news. You can see we've been in good news territory for awhile. 

This can be a great tool to signal when to get out and when to get back in. Look at the circled cross overs in the chart of the DOW.

From an emotional perspective, it feels like we are in overbought territory, but until the indicators change, I am in.