May Ends With A Whimper

As I mentioned yesterday, I had some business this morning with a government agency (State of California, to be exact), and my estimates of the time required to conduct the business were a little low. I estimated 10 minutes to conduct the business, it actually was closer to 15, and I estimated 4 hours of waiting time, it was closer to 5. Add in travel time (about 40 minutes each way) and my day was pretty well blown out of the water. So, I missed today’s market  in it’s entirety. If there is a ray of sunshine, the state is about to collapse Greece-style, so I may not have to deal with them much longer.

Well, atr first glance the most obvious thing to see on the chart is very high volume. Now comes the important part: did that volume come on the eay down or the way up? Can’t tell from this chart, but tomorrow morning’s intraday chart will tell us that. We still seems destined for a retest of 1292, and the closer we get, it seems the computers start the buying. Overall is am still bearish in the very short term but bullsih in the short term: I am positioning myself for a decent rally which may come in June.

 The Nasdaq 100 is about in the same shape, if not just a hair stronger. Here 2475 is the level I will be watching to see if it triggers the buying.

The Russell 2000 made a very nice recovery t0day, which might indicate we won’t gop all the way down to a retest: today’s low may be low enough to be considered close, and the retest buying may already be taking place.

The percentage of stocks above the 50dma on the NYSE tells us two things: the market in incredibly weak right now, and it is gaining strength. Judging by what this has down in the past, it is far more likely to go up than down from here, and is very unlikley to go as low as it did early this month.  Of course, that is not impossible, and it will pay to be ready in case there really is a first time for everything.

The same indicator in the Nasdaq looks about the same, and is an indication that, although the Nasdaq is not leading, it is not lagging, either. We might see it start leading a bit here withing the next week.

The market may be about to turn, at least in the short term. While I do not expect a rip your face off rally, I do expect some strength in June. May has been an awful month for the market, and we may have a decent June. If we do, I’m not too optimistic about July.

I will have the new highs update shortly.