Short-Term Chart Trends Unchanged
Guy S. Ortmann, CMT | Mar 22, 2018 10:33AM ET
The indexes closed mixed Wednesday with positive internals on the NYSE and NASDAQ as volumes rose from the prior session on both exchanges. No significant technical events occurred on the charts, leaving their respective near term trends intact. The data remains largely neutral with no short term probable projections in direction. As such, in spite of the increase in volatility over the past several sessions, the nature of the charts and data continue to suggest we maintain our near term “neutral” outlook for the major equity indexes.
- On the charts, the indexes closed mixed yesterday with the large cap indexes declining as the rest of the indexes posted gains. Of interest is the fact that internal market breadth was positive as was up/down volumes on increasing overall trade volume. We suspect the volatility of the large cap ETFs may be the probable cause for the split in performance. The near term trends are unchanged with the SPX (page 2), DJI (page 2), COMPQX (page 3) and NDX (page 3) in near term downtrends with the rest of the indexes in neutral, sideways patterns. The MID (page 4) did manage to close back above its 50 DMA. The cumulative advance/decline lines remain short term negative but above their 50 DMAs.
- The data remains almost entirely neutral including all of the McClellan OB/OS Oscillators (All Exchange:-10.24/+26.17 NYSE:-16.51/+25.51 NASDAQ:-6.08/+30.25). The Equity P/C (0.62). OEX P/C (1.22) and OpenInsider Buy/Sell Ratio (34.1) are neutral as well while the Total Put/Call Ratio (contrary indicator) is a bullish 1.16 as the crowd has grown nervous and weighted in puts.
- In conclusion, while the increase in market volatility has many wringing their hands in confusion, we have yet to see enough evidence to alter our near term “neutral” outlook for the major equity indexes
- Forward 12-month earnings estimates for the SPX from Bloomberg are $157.59 leaving a 5.81% forward earnings yield on a 17.2 forward multiple.
- SPX: 2,693/2,746
- DJI: 24,304/25,307
- NASDAQ: 7,254/7,474
- NDX: 6,745/7,009
- DJT: 10,475/10,761
- MID: 1,902/1,960
- Russell: 1,550/1,600
- VALUA: 6,105/6,251
Short-Term Chart Trends Unchanged
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