Data Unavailable
Opinion: All of the indexes closed higher yesterday with positive internals as volumes declined on the NYSE and rose on the NASDAQ. All closed at or near their intraday highs. Several indexes saw near term resistance levels violated. The bulk of the data is unavailable this morning requiring us to rely almost exclusively on the charts for our analysis. As such, the short term uptrends remain intact as well as our neutral/positive short term outlook. However, new important resistance levels are at hand. Given the size of the recent bounce and what we suspect will prove to be overbought levels on the McClellan OB/OS Oscillators, we suspect some tempering of progress at this point. The intermediate term outlook remains cautious.
- On the charts, all of the indexes closed at or near their intraday highs as all advanced with positive internals. The SPX (page 2), DJI (page 2), COMPQX (page 3), MID (page 4) and RUT (page 4) all closed above their short term resistance levels with current short term uptrends remaining intact. Both the DJT (page 3) and VALUA (page 5) closed at resistance. However, new resistance levels may prove to be more difficult to overcome given the accompanying overhanging volumes and degree of recent gains. As such, the charts remain positive for the short term but some slowing of progress may be the higher probability.
- The data is largely unavailable this morning. The two points we can observe are cancelling each other out. The new Investors Intelligence Bear/Bull Ratio (contrary indicator) shows advisors largely unmoved in their broadly bearish outlook in spite of the recent rally at 39.8/26.5. That positive signal is countered by the WST Ratio and its Composite that are both bearish at 72.1 and 168.3. So with our blind spot not allowing us further insight, the data is dead neutral.
- In conclusion, while we remain neutral/positive for the near term, the charts are now suggesting some potential slowing of the pace of the recent rally, if not some sideways trading action. The intermediate term remains cautious as our last view of the advance/decline lines found them still in downtrends.
- Forward 12 month earnings estimates for the SPX from IBES is $123.27 leaving a 6.4% forward earnings yield with a 15.6 forward multiple.
SPX: 1,874/1,937
DJI: 15,893/16,483
COMPQX; 4,280/4,547
DJT: 6,790/7,022
MID: 1,262/1,317
RUT: 958/1,021
VALUA: 3,830/4,074