Special Risk Capital Management LLC

Situation Normal . . . June 23, 2012

The elections in Greece and Egypt have concluded.  The organizational questions may have been answered but the situational ones remain; that part has not changed nor will it change quickly.  Many thought that the election would bring solutions or at least hope for them but reality is harsh.  We’re right back to where we were on the Friday before.  Market over extends one way, then the other.  Right now its tough to find an underlying trend.  But that could change soon.

The chart above shows me one big interesting thing.  Look at the big volume spike on Friday circled in red.  Wow, it really stands out.  A lot of shares exchanged hands on Friday, that means something, the question is what.  Here are my thoughts:  IF the price stays above the upward sloping blue line, that would be very positive and Bullish.  But IF the price falls and closes below the red support level of 2850, that would be negative and Bearish.

I tried to confirm the volume data on the NASDAQ since it was so high and unusual.  The two other sources I tried gave 2 different figures, but all were relatively close and all were showing very high volume.  My experience is anytime you see a volume spike like this major players are take large positions.  We can write scenarios to support either case, so let’s not get taken away with predictions.  We should have a handle on things by early next week.  (Or it’s also possible that traders were taking big profits from this fall just before the weekend; but I doubt that.)

Let’s wrap things up by looking at price strength in the S&P 1500 stocks.

Much improved (green) with a lot of caution / stalled stocks (yellow) and a healthy number of weak ones (red).  encouraging but far from confirming a price trend either way.

Lastly, we’ll look at sector performance.  These are the top 10 out of 68 stock sectors. 

The thing that jumps out to me is that they are healthcare related and / or defensive.  Not a sign of risk being put on by the big guys.  Have a good week and be watchful out there, something could be coming down the track.

charts courtesy of MetaStock and www.HighGrowthStock.com; used with permission.  click on any chart to enlarge it, comments and feedback Welcome, post at the top of this blog.