The indexes closed higher Thursday with positive internals on the NYSE and NASDAQ as overall volumes rose on both exchanges from the prior session. While there were no changes in the near term trends, the SPX and DJI did manage to post new closing highs. Unfortunately, the data is unavailable this morning, allowing us to only analyze the chats for this report. With that said, we are maintaining our near term “neutral/positive” outlook for the major equity indexes.
- On the charts, all of the indexes closed higher yesterday with positive internals on higher trading volume from the prior session. The SPX (page 2) and DJI (page 2) both closed above short term resistance to new closing highs. While the rest of the indexes advanced as well, there were no other violations of resistance or changes in trend on their part. However, the NDX (page 3) closed at resistance and should be monitored for a possible violation to the upside. So we find the near term trends remaining positive for the SPX, DJI and DJT (page 4) with the rest neutral. The cumulative advance/decline lines are unchanged as well with the All Exchange and NYSE neutral and the NASDAQ negative. All are above their 50 DMAs. As a side note, if one subscribes to “Dow Theory”, yesterday’s new closing high on the DJI confirms the new closing high accomplished by the DJT earlier this month.
- With the data unavailable, we are not going to speculate on its status as we are unable to determine the impact of yesterday’s gains on the McClellan OB/OS Oscillators or the balance of the indicators. Valuation is a bit stretched with consensus forward 12-month earnings estimates for the SPX at $169.00, leaving the forward 12 month p/e for the SPX at 17.3 versus the “rule of 20” implied fair value of a 16.9 multiple. The “earnings yield” stands at 5.77%.
- In conclusion, as there is no change on the charts regarding trend or general market breadth, we are maintaining our near term “neutral/positive” outlook for the major equity indexes.
- : 2,889/NA
- : 26,127/NA
- : 7,891/8,108
- : 7,400/7,579
- : 11,396/11,601
- : 2,020/2,053
- : 1,672/1,726
- VALUA: 6,514/6,635