Daily Market Comments - July 2007
7/31 - Stock Market Comments
All the indexes formed a Bullish Harami yesterday. This occurred when stochastics were now near the oversold conditions. The past year has seen an uptrend in the market that has been interspersed with hard-sell loss for a few days and then the Bulls step back in. We may have experience that once again this past week. Be buying long positions but remain nimble.
7/30 - Stock Market Comments
The markets sold off hard in the final hour on Friday, probably a function of margin calls. This morning's positive open could be an indication of a Bullish Harami potential for the day. Start watching for potential buy signals. There are many bottoming signals that have formed in the past few days in individual stocks. Currently the market trend for the past year has been a steady uptrend followed by sharp selling, then a steady uptrend again.
7/27 - Stock Market Comments
The large selloffs that occur during the uptrend are somewhat healthy. It keeps the euphoria from coming into the market. Yesterday's pullback definitely has put a damper on investor Bullish sentiment. Do not expect any major move in today's market. There should be choppiness in the markets until investors get a feel for what the market will do from here.
7/26 - Stock Market Comments
On Wednesday, the Dow moved up and just touched the T-line. Although it formed a Bullish Harami, the stochastics were not yet in the oversold area. That made the downtrend still a viable possibility. As mentioned in Wednesday's afternoon comments, this downtrend is not out of the woods yet. The much weaker open today, as indicated by the premarket futures, indicates the pullback needs to find a viable bottom. The 50 day moving average in the Dow remains a potential target.
7/25 - Stock Market Comments
Amazon is opening up 15 points higher today. This has changed the direction of Tuesday's investor sentiment. With the Dow futures opening up 62 points, any selling of long positions or establishing any short positions should be held off until there is confirmation that Tuesday was not a one-day selloff during a slow uptrend. Confirmation of the sellers being in control would result in a positive open today with the markets moving back down through Tuesday's close later in the day.
7/24 - Stock Market Comments
Although the Dow showed strength on Monday, the rest of the markets were not as robust. There were more stocks trading lower than trading higher on Monday. Today, there are lower futures that are starting to reveal the lack of sustained bullishness at this level in the markets. Be prepared to take profits in some of a long positions and add some short positions to the portfolio. This may be short-term but we do not know that yet.
7/23 - Stock Market Comments
Friday's selling may have been a function of options expiration. It created a Bearish Engulfing signal in the Dow. Today's futures are showing strength on the open. The trend is still your friend. A severe sell signal or a confirmed sell signal is required to indicate that the uptrend is over. Continue to hold long positions in strong sectors.
7/13 - Stock Market Comments
The anticipated breakout through the upper trendline was finally consummated Thursday, and 283 points in the Dow was a very pleasant and obvious indication that the upper trend channel was not going to act as resistance anymore. This morning's futures do not reveal any great profit-taking on the open. Do not be surprised to see some consolidation in the next few days of trading, but the fact that a large bullish candle breached the upper resistance level reveals that there is a new dynamic in investor sentiment. Stay long.
7/12 - Stock Market Comments
Wednesday's trading indicated that any selling in this market was going to be relatively mild, just as we've seen over the past two months while the markets have been in a trading range. Today's morning futures indicate more strength coming into the markets, once again making the upper trendline the target. Stay nimble until a definite breakout occurs to the upside.
7/11 - Stock Market Comments
The hard sell-off on Tuesday formed a gap down following a Doji in the NASDAQ. It closed below the T-line. At the same time, the Dow sold off at the top trend line resistance level. The expectation should be to see if support will occur at the bottom of the trend channel in the Dow. This would insinuate a few days to the downside. Tuesday's positions should have been lightened up on the long side.
7/10 - Stock Market Comments
The steady uptrend has moved the stochastics in the NASDAQ into the overbought condition. On Monday, the NASDAQ had a Doji day. The lower open today indicates some profit-taking should start hitting the market. Be ready to take some profits but watch to see if the T-line acts as support. The Dow is currently testing the upper resistance level. The apparent failure of a breach of that level today would indicate more sideways action in the markets for the next few weeks.
7/9 - Stock Market Comments
The holiday week showed more resiliency in the markets than anticipated. The slow steady uptrend was expected based upon the candlestick formations, but the magnitude of the buying was surprisingly strong. Stochastics are now in the overbought condition in the NASDAQ, but the Dow indicates more potential upside. As of now, there is nothing to indicate that the slow steady uptrend shouldn't remain in progress.
7/6 - Stock Market Comments
On Thursday the Dow consolidated, but the NASDAQ continued its uptrend. This provided the indication that nothing had changed the current trend. The NASDAQ is now trading above the upper trend channel. The Dow still has some more upside before testing that level. Continue to hold long positions. Nothing has yet changed the current investor sentiment.
7/5 - Stock Market Comments
The moderate strength brought both the Dow and the NASDAQ up toward the top end of their trading channels on Tuesday. Although nothing has indicated any weakness yet in this current move, start watching for potential sell signals as the top of the trend channel is met. Continue to hold long positions, but be more nimble in this area.
7/3 - Stock Market Comments
The strength in the Dow confirmed the direction in which the market was going to move after Friday's large Doji. The upward trend channel continues to be the likely target. Today will be a half session with the markets closing at 1:00 p.m. Do not expect any great price movement today but anticipate the uptrend to continue. Energy stocks continue to show good strength.
7/2 - Stock Market Comments
The Dow traded very indecisively on Friday, up 100 points at one time and down 100 points at another time during the day, finishing relatively flat. This formed a very large Doji above the 50 day moving average. This morning's futures are trading positive, which is revealing how they are planning to open the markets after a Doji. I would not anticipate any great trading volatility in the markets this week.