Wednesday, June 3, 2015

Squeeze For Juice

The Market Trend Model (data sheet) moved to a more mixed bias today as the Nasdaq and technology sector have begun to diverge from the S&P 500. 

After nearly two weeks of sloppy choppy price action the market indexes attempted to breakout on Wednesday with mixed results. The Russell 2000 (chart) fared the best with this index closing above its recent price resistance.  The Nasdaq (chart) and the Nasdaq-100 (chart) remain very near their all time highs while the S&P 500 (chart) was unable to close above its recent area of price resistance.

Despite what feels to be a herky-jerky market environment, this is actually one of the tightest range bound markets in U.S. history (article).  This is quite a testament to the world wide central bank monetary policies that are fighting against one of the slowest economic recoveries in modern U.S. history (article).

While the market remains in an uptrend from the early May 2015 lows, the indexes are now in an area where sellers have appeared repeatedly since April. In the QE world almost anything can happen (and usually does)...time will tell if there is much juice left in this squeeze.