Special Risk Capital Management LLC

The March Higher Continues, but Slower February 28, 2015

Once again this blog posting falls on top of my monthly newsletter (posted under that tab herein), so the Top Sectors and Market Strength pie charts can be found there.  Just click on that tab (above) and download the newsletter in Adobe (PDF) format.

On a more technical side: I see this market advance slowing, and that’s OK.  Note in the chart below how the price bar spreads (between top and bottom) are getting smaller; indicating that supply and demand are getting more balanced.  The daily advances this week were fewer and smaller.  Buyers are getting “filled up”, and once that demand is filled and there are fewer buyers . . the market is much more susceptible to selling pressures.

We also see this is the “money flow” histogram at the top of the chart; just less demand.  As this continues it could be a consolidation pattern where prices just go sideways for awhile, looking for a new reason or catalyst to resume buying.  Or, a chunk of bad news happens and we correct down.  Right now, no one really can tell.  In any case let’s be ready for whatever happens without get to anxious about it.  After all, this is “normal” price action.

Market sentiment remains positive for now.

Some of the leaders are showing signs of moderation / slowing.  They include Biotech and select Tech stocks (semiconductors), but International stocks are showing sighs of new strength (Japan, Europe and perhaps Latin America).  Be on the lookout.

Until next week.                …………….  Tom  ………………