Yesterday, the market gapped higher at the open (a) but had a lot of downward pressure. first prices moved to the 50 minute EMA, then rallied, but fell again to the 200 day EMA (c). Then prices fell hard through all the EMAs (d) on heavy volume. Considering the technical damage done to the markets, yesterday's price action -- especially at the close -- was disappointing and indicates there is tremendous nervousness among traders regarding the market still.
On the daily chart, notice that prices are clustering between roughly 105 and 109. However, the EMA picture is still extremely negative (b) with all heading lower, the shorter below the longer and prices below all the EMAs. The MACD (c) indicates there is a tremendous lack of momentum. However, the A/D line indicates we may not have seen the tremendous actual flight from the market as we'd think during a sell-off like this. This may be more of a "trading shares" situation where people who purchased a year ago are taking profits and new investors are looking for the market to move higher.
On the two indexes that track risk capital, notice that prices are clustering above the 200 day EMA -- staying in bull market territory.
Industrial metals are in a clear downtrend (a) with consolidation points along the way (b and c). However, notice the volume -- there was a big spike about two weeks ago (d) but the level of intensity is decreasing (e).
Notice the MACD (b) is very close to giving a buy signal and the A/D line reversed about a week ago (b).
Finally regarding the DBBs, notice the price action over the last 8 days fits in a trading range of roughly 1 point (18.30 - 19.40).
With the long-term Treasury market, notice the uptrend is still intact (a) and the EMAs are still bullish (b). However, we have three gaps in the uptrend (c). I am wondering if the last gap is an exhaustion gap. This would make sense given the high volume we're seeing printed in this area.
Gold spent 6 days moving lower in two downward sloping channels (a and b). However, it gapped higher Monday morning (c) moved higher for two days (d) and gapped higher again at the beginning of yesterday's trade (e) and then moved sideways (f).
On the daily chart, prices (b) have moved over the uptrend (a) and the EMA picture is strengthening (c). However, the volume is decreasing (d), indicating fewer investors are participating.
