Guy S. Ortmann, CMT | Oct 19, 2021 09:21AM ET
The major equity indexes closed mostly higher Monday except for the DJI and RTY posting losses. As occurred last Friday, the advances were accompanied by negative breadth on the NYSE and NASDAQ that suggests an increase in selectivity among the issues able to participate with market strength.
While not dire, we remain of the opinion that poor breadth has the potential to prove problematic. Most of the indexes closed at or near their intraday highs with one chart closing above resistance and its 50 DMA. So, the near-term trends are now positive on all but two of the charts as breadth remains debatable.
The data dashboard continues to send a generally neutral message. However, there was a notable and welcome improvement in insider buying. While the overall tone has improved to some degree, we are maintaining our near-term “neutral” macro-outlook for equities as the market is becoming more selective as not all boats are rising with the tide.
On the charts, most of the major equity indexes close higher except the RTY and DJI posting losses.
The data finds the McClellan 1-Day OB/OS Oscillators are all in neutral territory (All Exchange: +30.18 NYSE: +48.05 NASDAQ: +17.06).
In conclusion, the primary issue for our keeping our near-term macro-outlook for equities at “neutral” is the increase in the level of selectivity for participants in market strength.
SPX: 4,384/4,488 DJI: 34,452/35,418 COMPQX: 14,479/15,000 NDX: 14,834/15,356
DJT: 14,600/15,304 MID: 2,670/2,756 RTY: 2,240/2,290 VALUA: 9,464/9,827
h2 S&P 500/h2
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