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Friday, May 4, 2018

Daily update 5/4

Buying explosion.  The employment report did not inspire the market.  However, news that Warren Buffet added 75 million shares of AAPL in the first quarter did. 

The volume was rather light for such a big move.  That indicates the sellers took the day off.  I suspect a good bit of the buying was short covering.  Breadth was +72%.  New highs picked up a bit to 72.  New lows dropped down to 66.  SPX closed above the 20 SMA, but remains inside the resistance zone.

The futures ran into resistance at the 50 SMA.  Will they be able to break out above it and stay there this time?

The red count crossed back below 50, but is still above the green line.

It was a good day for bulls, but was it the start of a bigger rally?  It could be, but the bulls really need to prove it.  SPX is still in the resistance zone.  The last climax kind of selling day we had was 3/23.  The trouble is the bears have still  been selling every bounce so that 3/23 down day was not a true selling climax.  We have no way of knowing if the sellers have more work to do or not.  It is up to the bulls to prove they have the desire to push up through overhead resistance.

Have a great weekend.


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