The Durable Goods number came in significantly better than expected along with a jump in new home sales, and pushed the markets up in the morning. However, the positive numbers were not enough to sustain through the day and the markets turned around and looked like they were going to close in the red, only to once again climb back to green, with the exception of the TSX. Gold and silver started the day selling off, and then turned around, but both metals remain in a sideways trend. Oil remains in range as well. This price action was consistent with our indicators which pointed to a choppy indecisive day.
While some traders may do well on days such as this, I prefer to not risk my capital until there is clear direction. However, if you have the skill, capital, technology and tools to scalp, it is possible to make a trade in any market condition. The beauty of trading and investing is that there is always opportunity if you are patient and persistent. Everybody has different levels of capital and varying degrees of risk tolerance. Knowing these factors about yourself is an important feature in determining how you wish to trade.
As of this writing, futures are mildly positive and the DAX is positive, indicating a positive open, which may be the momentum from yesterday carrying through to the morning. Market condition scans are showing a jump in the number of overbought stocks. While the sell momentum is not particularly strong, this may suggest we may see a pullback today. The market bias indicators are also starting to show a more bearish bias. The combination of the indicators and the scans, point to another choppy day with a bearish bias.
| Index | Change | %Change | Level | Phase |
| TSX | -51.95 | -0.59% | 8797.44 | Recovery |
| DJIA | +89.60 | +1.17% | 7749.81 | Recovery |
| Nasdaq | +12.43 | +0.82% | 1528.95 | Recovery |
| SP 500 | +7.53 | +0.93% | 813.88 | Recovery |
| Russell 2000 | +9.73 | +2.33% | 426.51 | Recovery |
| NYSE | +62.67 | +1.24% | 5127.00 | Recovery |
Source: Telechart
Short Term market outlook:
Bias: Scans showing a neutral bias
Energy: Weak
Primary Trend: Remains down
| Sector | Phase |
| Consumer Staples | Bearish |
| Healthcare | Bearish |
| Technology | Recovery |
| Utilities | Bearish |
| Energy | Recovery |
| Financials | Recovery |
| Industrials | Bearish |
| Materials | Recovery |
| Consumer Discretionary | Recovery |
Source: Telechart
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