Some Bullish Stochastic Crossovers AppearOpinion
The indexes closed mixed yesterday with positive internals and lower trading volumes on both exchanges. No support or resistance levels were violated on the charts although a couple of “bullish stochastic crossover” signals appeared. Most of the charts remain in their new and lower trading ranges post 9/9. The data remains largely neutral with some additional counterbalancing signals. As such, we remain near term “neutral” in our outlook for the indexes while historically high valuation of the SPX keeps us intermediate term “neutral” as well.
- On the charts, the indexes closed mostly higher with only the DJI (page 2) and COMPQX (page 3) closing lower on the day. Internal breadth was positive as volumes declined from the prior options expiration session Friday. No major technical events occurred as no support or resistance levels were violated and new, lower trading ranges for most remain intact. Only the COMPQX and DJT (page 3) remain in their trading ranges that existed prior to the 9/9 break for the rest. The DJT, MID (page 4) and VALUA (page 5) flashed “bullish stochastic crossover signal’s” yesterday that are slightly encouraging. However, violations of resistance will be required for the picture to actually turn more positive.
- The data remains mostly neutral including all of the McClellan OB/OS Oscillators (All Exchange:-19.52/+5.34 NYSE:-29.19/+1.98 NASDAQ:-8.57/+12.79). Counterbalancing signals are coming from the OEX Put/Call Ratio (smart money) finding the pros fence hopping once again to heavy put exposure at 3.27. The WST Ratio/Composite evens the scales with a bullish 25.3/96.5. As such, the data remains essentially nondirective at this point.
- In conclusion, we have yet to see enough evidence form either the charts or data to alter our current near term “neutral” outlook for the major indexes. The 16.7 forward multiple for the SPX keeps our intermediate term view “neutral” as well.