It seems for nearly the last month we have morning weakness followed by a rally which brings us positive, but today we had almost the mirror image. A very nice rally early on, a bigger drop midday which started to look frightening, but then a reversal and slight rally which, on the SPX, brought us marginally positive for the day. We may be getting close to topping out here: CMF, which was at an extreme level, is coming down and volume is starting to drop, so it appears the big money crowd has decided this is not the place to buy. Whether it is a short, medium, or long term top is not knowable at this point, but the market is overdue for at the least a slight pullback.
Here's another clue for you all (no, not that the Walrus was Paul): the price relative on the Nasdaq was approaching a critical level and turned back down. This had been woefully under performing since the October bottom, played catch up this month, and almost caught up when it suddenly stopped. Now we have to see if this is just a pause, or if the longer term down trend resumes.
I have been pretty conservative with the pivot points today, so the "targets" are probably lower than they should be, but if they are correct, the Dow is now close enough to start feeling some resistance. Couple that with the drop in CMF (although this has not had a drop in volume), and we could be near a top.
If there is still evidence for the bullish case, it is the Russell 2000, which still has an up trending price relative line. It crossed an important threshold last week and held it today, and it it now continues up, the other stuff I pointed out on the other charts is probably moot. A leading Russell 2000 is, in my limited experience, about the most bullish indication you.
A lack of really compelling stock charts today gave me a chance to get some other things done, so I will give them a pass today. I will have the new highs update shortly.
