The major market indexes slid on Thursday but support still holds, writes technical analyst Guy Ortmann, who says the market data are generally neutral except for high investor fear levels.
Index Chart Trends See a Shift The wall of worry is in need of repair.
Apr 21, 2021 | 10:31 AM EDT
There were several shifts in near-term chart trends for the major equity indices Tuesday and some violations of support. Weak breadth was sufficient to turn the cumulative advance/decline lines negative while some further bearish stochastic crossovers were registered.
One possible silver lining, however, may be coming from the two of the McClellan OB/OS Oscillators that are now in oversold territory. Nevertheless, our concerns regarding the excess of bullish investor sentiment persist, as we believe the wall of worry is in need of repair.
More Technical Damage Done
Mar 05, 2021 | 10:24 AM EST
All the charts of the major equity indices suffered some form of technical damage Thursday. Indeed, all but one violated its near-term support level. Cumulative market breadth deteriorated further as well.
Still, indicators say markets are now significantly oversold, despite a lack of bottoming signals within a weakening structure.
On the Charts
Source: Worden
All the major equity indices closed lower Thursday with very negative internals and heavy trading volume on the NYSE and Nasdaq as all closed near the mid-points of their intraday ranges.
Every index, with the exception of the Dow Jones Transports (see above), closed below its near-term support level while the S&P 500 and DJIA closed below their 50-day moving averages.