Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

No Stock Sellers...Jobs Report Strong..... Market Overbought.......

Stock-Markets / Stock Markets 2013 Mar 09, 2013 - 01:20 PM GMT

By: Jack_Steiman

Stock-Markets

Once again, the market could find no sellers. The masses were thinking to sell the Jobs Report if it were good. Who can blame them since the market is so overbought. They were right. It sold. However, once it sold off some from the early morning highs, it was bought up once again. Not to the levels of the early day highs, but no real selling one would think likely after a strong early day pullback and still at overbought.


The strength of this market is a bit strange, but you never fight the price action of the market. It speaks above all else. It doesn't care what the technicals are saying. They've been flashing overbought and negative divergences for quite some time, but have yet to do anything about them. You don't front run just because something exists technically. You need to see the reversal first and we just haven't seen it take place. Until it does you stick with what's happening and that's pretty clear to everyone I'd think by now. The bulls are in full and complete control.

The bears have nothing. For crying out loud they can't even get a simple pullback going of 3-5% to unwind grossly overbought oscillators across all time frames. They have strong negative divergences staring them in the face and nothing. They are out of the picture but you never let your guard down and you never play inappropriately. You see the headaches the market is facing and you respect them at all times, so just in case they kick in, and at some point they will, you don't get crushed. One thing I've learned is that you must respect what you see. You keep playing the way the market tells you to but also with one eye on the problems that are out there so you don't get unnecessarily hurt. Today was another strong day for the bulls even though technically it should not have been. Never fight price action.

This morning the market was anticipating the Jobs Report to be strong based on the ADP jobs report that came out on Wednesday. The market wasn't disappointed at all as the jobs created was well above the 160,000 expected. The reading well over 200,000 and the unemployment rate was also a tick below expectations. Good to see things improving on all fronts for the people of this country. Hopefully the numbers are real and not made up but we'll just have to trust our leaders. Tough to do but we have no other choice.

The market gapped up huge on this report and probably why weakness was gobbled up quickly by the bulls once we sold off early on today from the gap up highs. If the economic reports keep coming in strong the bears are going to find it more and more difficult to get the market down. They have been on the improve and show no sign of deteriorating for now. The market seems to have anticipated this reality a long time ago. Markets move ahead of the actual events. The economy seems to be on the improve and is yet another reason why the bulls are not shy to buy on any weakness.

So what are those headaches for this market that, for now, don't matter. Well for one, we have strong negative divergences on the daily index charts across the board. It's not just one index, it's all of them. Some worse than others but they're all bad. Then we have focus on overbought conditions. The 60-minute short-term charts, the daily charts, and the weekly charts are flashing mostly 70+ RSI's. Not a good thing.

When you think about all these negatives it is amazing the market hasn't utterly collapsed. The strength is unusual but it is what it is. When you combine overbought indexes on all relevant time frames plus negative divergences on the daily charts the market really should get smoked in the short term. I don't honestly know why it hasn't yet but it's a testament to the power of liquidity and extremely low interest rates. You need to see the proper reversal candle to get the market rocking down. I keep thinking each day will bring it but, thus far, the market has climbed higher. Stick with what's working until it's not.

Resistance now for the S&P 500 is at 1576. This is the old intraday high. Massive support at 1531 on price and then 1521 or the 20-day exponential moving average. The Nasdaq has massive gap support at 3200 on any pullback. The gap is huge and this level should be very good for the bulls in terms of holding price. The trend is higher. The short-term is very iffy with all the headaches I spoke of above.

Keep it light but keep some exposure.

Have a great weekend!

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 15-Day Trial to SwingTradeOnline.com!

© 2013 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in