The SPX advanced 19.59 points yesterday to close at 1109.43. TOT daily traders were on the sidelines for the session.
The super long term perspective for the stock market remains bearish.
Both the long and short term models remain bullish.
Prior to yesterday, the last time the market advanced 28 or more points without an intervening selloff was the first week of December. That advance was followed by a three day selloff which completely erased the gains. And just as the market had no real direction then, it has no real direction now.
Yesterday’s gain was purely a function of one bit of good news after another – existing home sales, corporate announcements from GM, Kodak, and Qualcomm, and favorable media comments about Caterpillar and Sun. It’ll be tough to do an encore to that.
Volume actually declined from Friday, the advance/decline ratio on NASDAQ was a miserable 54:46 compared to NASDAQ’s point gain and was only slightly more than 3:2 on the Big Board. Of the 10 most active NYSE issues only 6 managed to gain. All in all, purely a news related rally with no legs.
Once again, the daily model is dead neutral today, with neither bulls nor bears having any particular edge. With unknown news the sole determinant of today’s direction, we will stand aside again. It’s boring to be sidelined, but this market has about as much internal direction as driftwood on the open sea.
Since initiation of this service on September 30, 1993, our daily trader recommendations have gained 6656.80 cumulative SPX points compared to a gain of 650.46 points in the index itself over the same period.
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