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Although we disagree with the idea that "the tape tells all," it is important for all traders to stay on top of key technical happenings on the charts. Below is our current "executive summary" take on the State of the Tape.
Technical Talk: April 29, 2011
Our Current Take:
From trend standpoint, there just isn't very much to complain about right now. Sure, stocks are overbought and some backing and filling is to be expected in the near-term. However, as the saying goes, the trend is indeed your friend right now.
We would consider being short-term buyers at: A pullback toward the 1340 area on the S&P 500
We would consider being short-term sellers at: A close below 1335 on the S&P 500
Trend and Momentum Indicators:
Short-Term Trend: The short-term trend is positive. Not much more to add here.
Intermediate-Term Trend: The intermediate-term trend is also now positive as the indices have all broken out on both the daily and weekly charts.
Market Internals: Nothing new to report today - Both of our TBC models remain positive.
- TBC = Trend-and-Breadth-Confirm Model
Market Momentum: As we said yesterday, our momentum models have finally moved up into the positive zone. However, there is some room for improvement in this area. Thus, we will be watching to see if the momentum can improve from here.
Support/Resistance Zones for S&P 500:
- Current Support: 1340
- Current Resistance: TBD
Early Warning Indicators:
Overbought/Oversold Condition: Absolutely nothing new to add... The indices are once again overbought from a short-term perspective and going that direction from an intermediate-term standpoint.
Investor Sentiment: Our sentiment indicators continue to deteriorate but are only moderately negative at the present time.
Chart Watch:
Below are snapshots of the two main charts we watch closely each day from a technical perspective. The indicators we display on the charts below include: 50 day weighted ma (purple), 18 day weithged ma (cyan), 10 day weighted ma offset by 2 days (orange), 4 day weighted ma offset 2 periods (dashed blue) and stochastic %K using 14 and %D.
S&P 500:
NASDAQ Composite
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