Sign Up to Receive an Email Alert when Technical Talk is Updated
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: August 11 , 2011
Our Current Take:
It would appear that after a devastating 13-day plunge, stocks are attempting to establish a short-term base this morning. We can see that 1120 has now become important short-term support after four consecutive "touches" of this level. Thus, we will now be looking for the bulls to make a push to test first the 1175 level and then the important 1200 level. So, unless the extreme violence returns, it appears that there are now levels to lean against.
We would consider being short-term buyers at: A close over 1175 on the S&P 500
We would consider being short-term sellers: A close below 1120 on the S&P 500
Trend and Momentum Indicators:
Short-Term Trend: With stocks now attempting to base between 1120 and 1175, the short-term trend can be upgraded a notch to moderately negative. A cross above 1175 would cause us to upgrade the trend rating again to moderately positive.
Intermediate-Term Trend: Although it is a clear positive that stocks appear to be basing at the present time, we will continue to rate the i.t. trend as negative.
Market Internals: No change AGAIN today... Both of our TBC models remain negative and in the sell zone.
- TBC = Trend-and-Breadth-Confirm Model
Market Momentum: Ditto AGAIN... Our momentum models remain 100% negative today.
Support/Resistance Zones for S&P 500:
- Current Support: 1120ish
- Current Resistance: 1175-1200
Early Warning Indicators:
Overbought/Oversold Condition: The indices remain very oversold an intermediate-term perspective but are starting to work off the oversold condition seen in the near-term indicators.
Investor Sentiment: Our sentiment indicators haven't budged today and continue to favor the bulls at this point.
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
The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of stateofthemarkets and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. Stocks should always consult an investment professional before making any investment.
Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.
The analysis provided is based on both technical and fundamental research and is provided “as is” without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.
The information contained in our websites and publications is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also President and majority shareholder of Heritage Capital Management, Inc. (HCM) a Chicago-based money management firm. HCM is registered with the U.S. Securities and Exchange Commission as an investment adviser. HCM also serves as a sub-advisor to other investment advisory firms. Ridge is a publisher and has not registered as an investment adviser. Neither HCM nor Ridge is registered as a broker-dealer.
Employees and affiliates of HCM and Ridge may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Editors will indicate whether they or HCM has a position in stocks or other securities mentioned in any publication. The disclosures will be accurate as of the time of publication and may change thereafter without notice.
Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.
