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: March 3, 2010
The Trend and Momentum Indicators:
Short-Term Trend: They say the most bullish thing a market can do is go up. So… it is safe to say that things are looking bullish right now.
Intermediate-Term Trend: The major indices still have some room to roam on the upside before encountering the January highs (watch the 1130 area on the S&P).
Market Internals: Same song, different day: Our TBC models* are now both in the positive zone, where stocks have gained ground at a rate of more than 30% per year historically.
*TBC = Trend-And-Breadth-Confirm Models
Market Momentum: No change: Our momentum models continue to improve and are now positive across the board.
Support/Resistance Zones for S&P 500:
- Current Support: 1110
- Current Resistance: 1130
The Early Warning Indicators:
Overbought/Oversold Condition: It bears repeating that while the market is overbought from a short-term perspective (and now neutral from an intermediate-term outlook) the current overbought condition has now been in place long enough that we can view it as a sign of strength.
Investor Sentiment: As we've been saying, the sentiment indicators are starting to show a little more optimism -- but have not become dangerous.
Current Strategy:
There is an awful lot to like about the current romp to the upside. We've seen the major indices slice through short-term resistance zones. We've seen solid improvement in our models, confirming the move. And we're seeing nice leadership from the small- and mid-cap indices, which are currently movin' on up to new cycle highs. However, we must keep in mind that there is a gap on the chart of the S&P, which will be filled at some point.
We'd be Short-term Buyers At: A successful retest of 1115 on S&P 500
We'd be Short-term Sellers At: Close below 1094 on S&P 500
S&P 500:
NASDAQ Composite
The indicators we have displayed on the chart above include: 50 day exponential ma (purple), 25 day exponential ma (cyan), 10 day weighted ma offset by 2 days (orange), standard deviation bands using 1.9 std dev of 21 day and stochastic %K using 14 and %D.
S&P 500 Last Intraday
S&P 500 Last 3 months
S&P 500 Last 12 months
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 TopStockPortfolios 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 TopStockPortfolios publications is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also
