Market Grinding Along...

The market looked bad with the way it closed on Tuesday, but there was the usual no follow-through from the bears. We woke up to slightly higher futures when most thought they would be decently lower. The market shot up with the Nasdaq 100 testing gap resistance at 4947, but that became too tough for them thus the rest of the day was spent meandering about. What else is new, I guess. The S&P 500 2045 to 2119 range, which is quite wide and loose, making things difficult for sure. When you think something interesting is about to happen for one side it doesn't happen at all. No breakouts. No breakdowns. The sixty-minute charts were set up for the Nasdaq 100 to break through the 4947 resistance gap, but even a good set up couldn't get the job done.

It seems, no matter what the set-up may be, neither side is able to get it going. So we spent another day trying to do something significant, but we ended up having a day to nowhere when we look at it from the bigger picture perspective. Nothing changed from the same old. We had a shot, but nothing changed. No surprises any more. No matter how we close you can't expect the next day to follow through. It's just a wide and loose time for the market. Nearly 4% worth of trading range with the low end and the high end rarely touched. More on the lower end. Each day different from the prior in terms of what one should expect. Russian roulette pretty much daily. Tough way to trade. Express Scripts Holding Company (NASDAQ:ESRX) is an example. An absolutely perfect set-up that, for no apparent reason, drifted lower after we entered.

And the beat goes on.

For those of you following froth, it is no longer due to the Fed. We saw a decent drop in the number this week from 42% to roughly 36% on the spread, but it all came from the bulls dropping that 6%. The bears stayed virtually the same. Still a ridiculous 14%, but, again, we know it doesn't really matter with the global effort being made to prop up markets. Asia is now fully involved in a new program, while Europe is in a crazy one themselves to the tune of a trillion dollars per year. Yes, trillion, not billion.

Froth would normally play a huge role at these insane levels, but the Fed Governor's around the world are making sure, at least as much as humanly possible, that there are few other places for folks to put their hard earned dollars. The markets biggest concern are the weekly and monthly charts, not froth. Froth at these levels for over a year would normally crash a market, so we know we can totally ignore it for now. If the Fed raises rates, then we can probably take the froth readings more seriously. For now, we don't, but those who want to know how this is going, you can see there was some improvement in terms of at least some bulls turning agnostic. Not yet bearish, but clearly agnostic and that's a start anyway.

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Not much else to say other than we're in a basing pattern that's now almost five months old. Bear-market stocks keep giving head fakes. We see that constantly with gold and oil. I'd suggest staying away from those areas. You can get lucky, but why put yourself in that type of situation. Stick with the best set-ups and pray a lot. Some work and some don't as the market gives head fakes not only on the overall market, but on individual stocks as well. Try to buy weakness as much as possible. Nothing is easy as there's nothing bullish nor bearish for now. Just back and forth. Watch 2045 and 2119 with nothing else mattering bigger picture.

Written By: Jack Steiman