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Wednesday, April 6, 2016

Daily update 4/6 End of debt super cycle?

Interesting day.  The market messed around this morning until the oil inventory data came in with a 4.9 MB build.  That sent oil and stocks flying up.

SPX tested yesterday's low this morning and held.  It then went on to completely fill yesterday's gap down.  Breadth was +67%.  New highs increased to 123.    The FED minutes came out at 2 PM and caused a bit of a sell down.  Then out of the blue the market spiked up into the close.  Unfortunately those late day moves are not particularly good at forecasting future direction.  We have pretty clear support (2042) and resistance (2075) and it is a pretty tight range.  In between is just noise.

The futures survived yet another trip below the 20 SMA.  They ended the day back above it because of the late day push up.  The question is will they be able to stay there.

The green count barely moved up today.  This leaves us with both counts below 50 and a neutral condition. 

The market has worked off the short term overbought condition.  Are we topping or preparing to bust through resistance?  Internally the market looks weak, but so far the bears have failed to capitalize.  We will have to wait for the resolution of the current trading range to indicate the next short term move.

This is an interesting article with a bit of history on how we got where we are.  2016: The End of the Global Debt Super Cycle


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