Good evening traders,
I wanted to post another update on the current state of the markets and how I see things. Again the markets closed in the red today and continued to show us weakness. Remember, the Russell 2000 was the first of the four to close under its 20-day exponential moving average. It did this on January 9th – ten calendar days before the Dow closed before its 20-day EMA.
I will post the full-size daily charts below at the bottom of this page.
The S&P500 ($SPY) once again is showing weakness as it is tightening up and starting to possibly roll over. The past week it has closed above and below the 8-day EMA several times. Looking at the chart it’s hard to determine what it wants to do. It’s been held under resistance around 227 and is holding fairly tight underneath – especially the past two weeks. That is why I rely on the moving averages and the other indices to help read the market. If the S&P closes below its 20-day EMA (and its close), we could see all four in my caution zone.
Finally, the Nasdaq ($COMP) is the only to look healthy and and it continues to show strength. Another red day will likely push it into weak territory but that won’t surprise me if it does.
I hope this information provides some value to you in your trading; including new and existing positions. If so, leave a comment below. 🙂
S&P500 ($SPY) – Bullish – Weak
Nasdaq ($COMP) – Bullish – Strong
Dow Jones ($INDU) – Bullish – Caution
Russell 2000 ($IWM) – Bullish – Caution