Jerry Samet
10-07-2023, 10:14 AM
The market staged a positive reversal yesterday after a weak open. The major averages sold off early after a stronger than expected employment report. The major averages finished high in their intraday trading ranges with solid gains. The COMPQ and the NDX gained 1.60% and 1.70% respectively. The SPX rallied 1.18%. Volume was higher across the board. This produced a follow through on the COMPQ. Leading stocks participated with the leaders index gaining 2.75% on the day. The index closed just above its 50dma near a confluence of several moving averages. Volume was higher and just below average. The market sold off early after the employment report came in a lot higher than expected. After about an hour of trading the major averages reversed and rallied into the close. The gains were solid and volume increased. This produced a follow through on the COMPQ, but not the SPX. This follow is poorly confirmed as none of the three indicators I use to confirm follow throughs confirmed. The weekly Coppock is just above the zero line and will cross it next week. It will likely be two or three weeks before it will signal. The %Es are well above the top of the range where it can signal and there was no Eureka signal yesterday. There are a couple of positives also. A couple of the short term indicators I look at, the Summation Index and the A minus E numbers are turning up or close to it. Overall, this is a low probably follow through that has a good chance of failing. I think the market was setting up for a solid rally, but I have my doubts that this is it. I would expect it to come soon as many factors are lining up. There is a new uncertainty now with the Hamas attack on Israel. We are looking at the possibility of a full scale war in the Middle East and we can’t predict at this time how that will effect the market. Jerry