Special Risk Capital Management LLC

The Market That Refuses to Stay Down July 18, 2015

This has been quite a week.  The general feeling is that Greece (could be) resolved at least for a couple of years.  Iran (could be) contained at least for “a while” and corporate earnings are coming in pretty nicely, Thank You.  The chart below of the broad NASDAQ Composite Index would seem to indicate “Happy Days Are Here Again” (whoops, showing my age).

The old saying “It’s not the stock market, but a market of stocks.” is really holding true right now.  About 5 sectors are moving this market higher.   The index is at all time highs, but we remain rather volatile.  Support held at 4905, al most on the nose, and then had a massive rally this past week.   International news seemed to quite down and Technology earnings took center stage.  Note Market Sentiment turned positive on Tuesday and off we went.  Money Flow is again positive, though not great.  Obviously we are NOT in a Distribution structure so I’ve removed those labels.

Since we’ve come a long ways in a short time, be expecting a slight price retrench this week.  As long as volume is low, that’s OK and healthy.  I also call your attention that price is knocking at the door of two upper trend lines which could hold resistance.   How is the general market doing?  The pie chart below is of the S&P 1500 stocks, showing the amount Bullish (strong), Neutral and Weak (bearish).

A significant improvement that may have some room to run.  Next I look at where the strength is coming from.

This is from a list of stocks that I consider as “buy candidates”.  No surprises here as the previous leaders have continued their strength.  (note: click on any graphic to enlarge it)

I am going to be Uber Busy the next 3 weeks, so I pre-apologize if I’m late for a post or if it is short.  If you are out in San Francisco mid August you may want to attend this one day conference: http://www.tsaasf.org/Best-of-Wyckoff-2015 .  Have a good week and Good Trading.  …  Tom  ….