Guy S. Ortmann, CMT | Oct 28, 2022 09:40AM ET
The major equity indexes closed mixed on Thursday, ending the day at or near their intraday lows. Internals were positive on the NYSE but negative on the Nasdaq, as trading volumes declined on both. In our view, the market “pause” suggested by the data noted yesterday continued.
On the charts, two of the indexes shifted down to neutral from bullish, while market cumulative breadth remains mostly positive. Unfortunately, the McClellan 1-day OB/OS Oscillators remain on warning signals as all are overbought, with stochastic readings in the same condition as one bearish crossover signal was generated yesterday. So, while we believe current extremely bearish investor sentiment represents a potential positive for the markets, the data and charts, in our opinion, still suggest some further consolidation/pause of the recent rally’s gains.
On the charts, the major equity indexes closed mixed yesterday with the SPX, NASDAQ Composite and NASDAQ 100 posting losses as the rest managed minor gains.
The data finds the McClellan OB/OS Oscillators remaining cautionary and overbought with the NYSE’s very overbought (All Exchange: +90.58 NYSE: +105.72 Nasdaq: +87.3).
In conclusion, yesterday’s fade from its intraday highs with the McClellan OB/OS Oscillators and stochastics on cautionary signals, in our opinion, continue to imply some further consolidation of the rennet rally gains. We would be buyers on weakness near support.
SPX: 3,745/3,904
DJI: 30,757/32,022
COMPQX: 10,734/11,348
NDX: 11,157/11,402
DJT: 12,834/13,521
MID: 2,319/2,408
RTY: 1,720/1,810
VALUA: 8,121/8,350
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