Guy S. Ortmann, CMT | Dec 22, 2021 08:59AM ET
All the major equity indices closed higher Tuesday with positive internals on the NYSE and NASDAQ as trading volumes declined from the prior session. All closed at or near their highs of the day as no significant selling pressure appeared near the close. Several of the index charts saw technical improvements with two turning their near-term trends to neutral from negative while cumulative market breadth saw a slight improvement as well.
On the data side, the 1-day McClellan OB/OS Oscillators returned to neutral post their oversold conditions that suggested yesterday’s rally. The rest of the data remains mostly neutral as well. While it is a bit early to have a high degree of confidence that the recent market correction has been completed, yesterday’s action, in our opinion, suggests it has become more likely.
On the charts, all the major equity indexes closed higher yesterday with positive internals.
Yesterday’s rally pushed the oversold McClellan 1-Day OB/OS Oscillators back into neutral territory (All Exchange: -8.26 NYSE: -12.26 NASDAQ: -6.18).
In conclusion, while yesterday’s action was a welcome encouragement regarding a possible completion of recent volatility, it is still a bit too early to go out on that limb. Nonetheless, we remain “neutral/positive” in our near-term macro-outlook for equities.
SPX: 4,586/4,655 DJI: 34,592/35,993 COMPQX: 15,081/15,416 NDX: 15,789/16,080
DJY: 15,484/16,277 MID: 2,646/2,750 RTY: 2,120/2,220 VALUA: 9,476/9,710
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