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WALL STREET CRAPS STOCK MARKET OBSERVATIONS FOR JULY 28, 2014

July 27th, 2014

craps front coverSTOCK MARKET OBSERVATIONS FOR July 28, 2014: The stock market made another attempt at the old highs during this past week. In doing so, it pushes most of the internal breadth indicators to “neutral” readings. With a lot of negative news from geopolitical sources, the market could easily decline into a short-term oversold condition in the coming week. The kind of action that we are seeing now is typical of the topping process. My guess is that we will either get a short-term buy signal on more bad news or else make another push to new highs. But be careful here because the next closing high in the Dow Jones Industrial Average may, in fact, be the last one of this rally.

Key underlying market indicators show the following:

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My advice for traders and investors is do nothing and let the market set itself up for its next big move. More downside here would permit the oscillators to become more oversold and present a short-term buying opportunity. When the bad news lets up from the geopolitical problems, there could be a sharp but short rally to new highs. If you’re looking to sell, do so on a less-than-strong closing high in the DJIA in the last hour.

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