Over the past week my core market health indicators held steady as the market whipped back and forth. The lack of movement in the indicators while the market was falling sharply on Wednesday and Thursday indicates internal strength. None of the core indicators moved enough to change any portfolio allocations.

One thing of note this week is that the sharp dip didn't cause any of my measures of risk to move much. Market participants aren't reacting to downward price moves. One illustration of fear comes from price targets gleaned from the Twitter stream for the S&P 500 Index (SPX). On the chart below each red dot represents multiple market participants tweeting the same price level for SPX. Notice that the declines in early and late 2014 put enough fear in the market to result in a fair amount of lower price targets on dips for several months. Traders got skittish and tweeted their fears of how low the market might fall. The August / September correction didn't result in the same behavior. Market participants have left their fear behind.

One minor concern comes from Dow Theory. For the first time since the 2009 low we have a negative non confirmation. The transportation index (DJTA) created a new secondary low in on 11/12/15 by falling more than 33% from the last secondary low over a period lasting three weeks. The decline yesterday pushed price below that secondary low. This is an overtly bearish sign for the very long term trend. In order to clear the non confirmation DJTA needs to move back above the 11/20/15 peak.

Although DJTA is now overtly bearish, the industrials (DJIA) still have a lot of space for consolidation without signalling a long term trend change to a bear market. DJIA would need to fall below 15,666 to signal a bear market so I'm not too concerned at the moment. However, any time we get an overtly bearish sign from Dow Theory it's time to start watching the market (and your personal holdings) much more closely.