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Day Trading. Index Trading. Technical Analysis. Stock Market. Market Commentary. Market Outlook. |
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Index Day Trading™ - Daily Market Analysis |
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Market Outlook
(Archive)
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- Learn Definitions used in our Market Outlook.
- Market Outlook Archive is updated on a daily basis.
Market Stage
(6/26/2009)
From yesterday's report: 'Rising SBV levels would tend to favor a continuation of the current market recovery.' In today's action, the Nasdaq 100 moved higher; meanwhile, the S&P 500 and the Dow ended the session slightly in the red.
60-day charts with a 20-period SBV are presently showing advancing SBV readings on the Nasdaq 100; in contrast, on the S&P 500 and on the Dow, we are however seeing declining SBV values. At the end of today’s session, the following SBV values were noted: Plus 50% on the Nasdaq 100; plus 17% on S&P 500; plus 4% on the Dow. While there are currently mixed SBV readings on 60-day charts, we believe the odds slightly favor a market decline. Apart from the fact that SBV readings are in decline on the S&P 500 and on the Dow, we are seeing an accumulation of bullish volume on the NASDAQ 100 which may serve to push this index lower.
Longer-term charts (i.e., 1.5-year charts with a 10-period SBV) are presently showing flat SBV values for the S&P 500 and for the Dow; meanwhile, SBV readings are on the rise on the NASDAQ 100. This chart setting points to a change of sentiment which could perhaps prompt a move of the major indexes back to their early June 2009 highs.
Market Status
(6/26/2009)
Market Performance:
�Last Change Volume A/D Ratio S&P 500 918.37 
1.87 (0.20%) 3,315,099 0.73 NASDAQ 100 1,480.20 
4.38 (0.30%) 1,006,040 1.00 DJI 8,432.42 40.58 (0.48%) 836,841 0.67
The NASDAQ 100 was able to build on its gains from yesterday, adding 0.3% in today's session. In contrast, the S&P 500 and the Dow relinquished some of Thursday's gains, closing off modestly today, down 0.2% and 0.48%, respectively. For the week, the major indexes showed a mixed performance, with the NASDAQ 100 gaining 0.61%, the S&P 500 losing a modest 0.27%, and the Dow off 1.22%.
Today's volume output on the S&P 500 amounted to 3,315 million shares, a full 31% below the index's average daily volume over the past three months.
NASDAQ 100 - 6/26/2009. 1-day Intraday, Modulated Volume.
Volume Analysis:
9:30 - 16:00: Today's market performance on the major indexes can best be described as choppy. This holds true for the NASDAQ 100 as well. The index started the session with a modest gap down opening and then spent the entire day in a very modest uptrend. From a volume analysis perspective, today's session brought little excitement. The day's most dynamic phase occurred early, on, roughly between 9:35 and 9:45. Over this 10-minute stretch, the index surged strongly. It was during this brief rally that the index generated its first sizable output of bullish volume (bullish volume is indicated by the predominantly green areas appearing on the SBV oscillator pane during this time). As you can see on a one-day chart of the index, this buildup of bullish volume quickly brought about a modest downside reversal on the index, indicating that the bulls' momentum had been quickly spent. After its 9:45 swing high, the market then retrenched, pulling back until shortly after 11 o'clock. During the modest pullback, the index accumulated some bearish volume (as evidenced by the predominantly red areas appearing on the SBV oscillator pane during this time). This buildup of bearish volume ultimately exhausted the bears' efforts to bring to market down further. Shortly before noon, the index then rallied smartly. The market's renewed advance was maintained right into the close; however, the bulls' efforts were very cautious in the afternoon. This can be attributed to the production of two bullish volume surges which peaked around mid-day, as well as shortly before 13:00. After the second of these bullish volume surges had peaked, the market traded in a sideways holding pattern for most of the remainder of the day. Some volatility was seen late in the session, with a large bullish volume surged appearing on all the major indexes just before the close. A 5-day chart of the index reveals that today's session resulted in a surplus of bullish volume.
Short Term (lasts a few hours to a few days): Despite the fact that the NASDAQ 100 managed to close up for a third consecutive session, market observers described today's action as tepid, listless, and choppy. The session also generated a surplus of bullish volume (as discussed in the Volume Analysis section above), although it was quite modest (see 5-day charts).
A review of five-day charts of the major indexes leads us to believe that the short-term outlook could remain mildly positive. Looking back over the past 5 trading sessions (on 5-day charts), we still see significantly stronger bearish volume surges (in red) than offsetting bullish volume surges (in green). For instance, the 5-day chart of the S&P 500 shows large bearish surges on June 22, 23, and 24 (late in the session). Meanwhile, recent bullish surges have not been as pronounced. We believe the bulls should still have some ammunition left to push the market modestly higher over the short-term. Apart from the possibility of a brief intraday pullback, we therefore believe there is still some potential for the major indexes to move modestly higher.
Analyst's Daily Tip:
Volume moving average (VMA):
The Volume Moving Average (VMA) is a key indicator used in our charts and technical analysis. The VMA refers to the volume of a security, commodity or index averaged over a given period. For example, a 5-minute moving average consists of the last 5 volume bars, each representing the volume activity of one minute summed and then divided by 5. After the next minute has elapsed, a new value is added to the 5-minute VMA, and the oldest value is dropped from the calculation.
Charts: Customizing Chart Views
You may wish to hide the legend displayed on our charts. To do so, press the Ctrl+L keys together. This combination works as a toggle, activating or hiding the chart legend.
In order to change the thickness of the VMA line, use the Ctrl+B keys together. This combination works as a toggle, allowing you to change the VMA line from thin to thick, and back.
Financial Press Overview:
News flow was limited today, undoubtedly contributing to the listless, meandering session seen on the major indexes. A rebalancing of the Russell indexes and some window dressing ahead of the end of the second quarter (early next week) introduced some volatility, notably near the close. Strength in large-cap technology stocks (Apple, Google) helped the NASDAQ outperform the Dow and the S&P 500.
Today, the government released personal income and personal spending data for the month of May. It became apparent that the government's efforts to revitalize the economy appear to be stimulating the savings rate rather than increasing the spending rate. This is causing some concern among economists, who are hoping that some two thirds of the government's stimulus payments will ultimately end up being spent rather saved by wary consumers. In May, the US government mailed out a total of $13 billion in one-time stimulus payments. At the same time, the US household savings rate has risen to its highest level in more than 15 years. Whereas stimulus money pushed incomes up by 1.4% in May (representing the largest gain in a year), it did not contributed to a significant rise in consumer spending (spending was only up 0.3%).
Key economic data for the week starting June 22nd, 2009. Numbers shown are consensus estimates (market anticipates this value) and prior value.
| Tuesday: | |
 | 9:00 AM S&P CASE SHILLER INDEX (May): n.a. / 140.0 S&P CASE SHILLER Y/Y (May): -18.8% / -18.7% 9:45 AM CHICAGO PMI (June): 38.8 / 34.9 10:00 AM CONF. BOARD CONSUMER CONFIDENCE (Jun):55.1 / 54.9 |
| Wednesday: | |
| NEW VEHICLE SALES (Jun): 9.8M / 9.9M 8:15 AM ADP EMPLOYMENT CHANGE (Jun): -372K / -532K 10:00 AM ISM - MANUFACTURING (Jun): 44.0 / 42.8 CONSTRUCTION SPENDING M/M (May): -0.5% / 0.8% PENDING HOME SALES M/M (May): 1.1% / 6.7% |
| Thursday: | |
| 8:30 AM NON-FARM PAYROLLS (Jun): -375K / -345K UNEMPLOYMENT RATE (Jun): 9.6% / 9.4% MANUFACTURING PAYROLLS (Jun): -150K/ -156K AVERAGE HOURLY EARNINGS M/M (Jun): 0.1% / 0.1% CONTINUING CLAIMS Jun-20: n.a. / 6738K INITIAL CLAIMS Jun-27 (H): 610K / 627K 10:00 AM FACTORY ORDERS M/M (May): 0.4% / 0.7% |
| Friday: | |
| Markets Closed |
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