S&P 500 (SPX) rallied back into the range high resistance yesterday, and potentially nullifying the pullback opportunity the market was looking going into the week.
SPDRs S&P 500 (SPY) volume dropped off yesterday from the previous day's above average reading. Now it is in line with what what we have seen over the past week.
On the 30 minute chart of SPX, there is a clear downtrend in place that has yet to be broken with lower-highs and lower-lows.
USD/JPY continues its rally via BoJ intervention. Up another 0.5% this morning.
The 5-day, 10-day and 20-day moving averages are all separated by less than a 3 point margin. The price range is tight, and is the tightest that this market has seen over a 30 day period since 1965 (that would be 51 years!).
Stocks are continuing to lose momentum under the surface despite the market within points of its all-time highs. This can be most clearly seen by looking at the percentage of stocks trading above their 40-day moving average. Since July 18th, that number has dropped from 80% down to 59%.
The market consolidated in a similar manner this time last year before ultimately leading to a large sell-off.
CBOE Market Volatility Index (VIX) had one of its regular meltdowns, opening up higher but quickly giving up its gains and finishing 5.2% lower at 12.94.
The market is showing a decoupling from oil as the rise and fall of the commodity in June, July and now August has not impacted the market substantially.
Three support levels to watch going forward on SPX is 2168, 2155, and 2147. The breaks are only valid if the price can close below those support levels.
Dow Jones Industrial Average (DJIA) has a double top that confirms on a move below 18247.
My Trades:
Did not add any new trades to the portfolio yesterday.
Did not close out any trades in the portfolio yesterday.
May add 1-2 new swing-trades to the portfolio today.
Will consider adding additional short positions to the portfolio as the market warrants it.
