Markets put in back to back relatively quiet sessions after plenty of volatility since the late August slump. For the S&P 500 that could be a good thing as it attempts to digest the big the last 2 weeks 4% plus moves. As well the longer it resides up near the 2020 number the more likely it will break above the double bottom many are talking about. If it could hang up here for several sessions the 50 day SMA will begin to slope higher. The Nasdaq will be trying for it first 3 week winning streak this week since early March. Benchmarks deviated from the normal cues it has been getting from the oil markets Monday, perhaps letting some leading sectors try and play catch up. Crude slumped almost 5% today and the transports seem to be taking a pause which would be refreshing. See if this is just a dead cat bounce in that group or if it has staying power. A good tell can be best of breed UNP which recorded a spinning top candle Friday which often indicates a pause in a trend can be taking place. We have had some big news events recently which can typically lead to big turnarounds, of course it is only known well after the fact but we suggested the big Glencore news a few weeks back could have marked the bottom of the commodities market in general. Then this morning we had the mega merger between 2 “old tech” names which really never kept pace with some of the better performing peers. Will the combination of EMC and Dell be looked back upon as the nail in the coffin of a huge 15 year double top in the tech rich Nasdaq? Looking at some new tech, TWTR had a rough session and is now trading back toward a flag trigger breakout we presented in our Monday 9/21 Game Plan below.
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