Friday, October 14, 2011

Morning Market

Over the last three days, notice the volume on the IWMs and SPYs has stalled a bit and that the respective candles have gotten smaller.  The IWMs have gotten caught at the 50 day EMA.  However, the shorter EMAs are now moving higher and the 10 say EMA has crossed above the 20.  The lack of volume is still concerning to me, as it indicates there is declining enthusiasm for the rally.

The 7-10 year Treasury market is still below the 50 day EMA.  But the price pattern is one of bottoming -- there are four separate candles with very small bodies and two days of somewhat weaker volume. 

If the fundamental economic picture were different, I'd be more bullish on this week's developments, as they would fall into the category of turnaround.  However, with the fundamentals as confused as they are right now, this looks more like a one week event rather than the beginning of anew trend.