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.
There Are No Bottoming Signals Yet thestreet.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from thestreet.com Daily Mail and Mail on Sunday newspapers.
What s Next for the Markets? What the Charts and Data Reveal The Rydex Ratio has turned neutral but insider buying remains absent.
Some calming of the waters may be at hand.
While several charts of the major equity indices suffered damage in Thursday s selloff, we have reason to expect some pause or possible bounce.
The Overbought/Oversold oscillators are now nicely oversold, leveraged ETF traders have backed off of their heavily leveraged long exposure while the 10-year Treasury yield hit our expected move to 1.5%, suggesting a possible near-term peak in yield and low in price.
However, insider buying remains absent as insiders have been active sellers over the past few weeks.