Yesterday I wrote an article about positive divergences on New Lows for the Nasdaq and NYSE. The Nasdaq is still sporting its positive divergence with New Lows, but the SPX, NYSE, OEX (not shown), S&P400 (not shown) and NDX (not shown) have lost the positive divergences they had yesterday. The SPX wasn’t showing the positive divergence yesterday except in the very short term, but that has disintegrated as well.
Conclusion: Sorry for the bad news, but a bear market rally isn’t likely in the cards yet. It’s certainly possible we will rally as we do have oversold indicators out there, but given the high volume selling and crash today, we doubt any rally will be sustainable.
Good Luck & Good Trading,
Erin Swenlin
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Technical Analysis is a windsock, not a crystal ball. –Carl Swenlin
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