WALL STREET CRAPS STOCK MARKET OBSERVATIONS FOR SEPTEMBER 14, 2014
STOCK MARKET OBSERVATIONS FOR September 14, 2014: The stock market experienced a mild correction that has put it in a slightly oversold condition. With a little more downside, it could set up a short-term rally to challenge the old highs. In the meantime, interest rates have increased to provide the backdrop for a more significant decline in the coming weeks. I’d expect one final narrow-based rally within reach of the old highs before the stock market makes a steep decline into October-November.
Key underlying market indicators show the following:
- NYSE Breadth Oscillator – Ultimate Indicator – 26 (oversold)
- Nasdaq Breadth Oscillator – Ultimate Indicator – 38 (neutral)
- NYSE % Above 50 Day Moving Average – Ultimate Indicator – 28 (oversold)
- Nasdaq % Above 50 Day Moving Average – Ultimate Indicator – 50 (neutral)
- S&P 100 % Above 200 Day Moving Average – Ultimate Indicator – 30 (neutral)
- S&P Bullish Percent Indicator – Ultimate Indicator – 34 (neutral)
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My advice for traders and investors is let the market set-up for one last rally in order to move completely to the sidelines. The stock market has experienced a long rally for the majority of 2014 and now is the time to prepare for a meaningful correction both in extent and duration.
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