Technical Round Up

Kevin Lane of Fusion Analytics is a good friend of mine — and an excellent technician. He has been out of the loop for some time now setting up the new office.

He is now back in the saddle and easing back into putting out regular technical commentary. Kevin covers a lot of my favorite technical indicators. Yesterday, he put out a few charts well worth reproducing here:

As seen below the cumulative advance-decline line on the NASADAQ was in decline long for a long time.

NASDAQ Cumulative Advancers-Decliners:


The NASDAQ Cumulative Up-Down Volume line gave way to more distribution as seen by the breaking of the uptrend line (green line and red circle) as more and more issues declined.

NASDAQ Cumulative Up-Down Volume:


Given the more consistency of 52 week lows (red circle) of late this suggests there is good distribution in the tape. Another shot down towards the -300 level (orange line) would probably help set a short-term oversold condition. However give the more frequent dips below the zero line in the last few years and the continued weakening a/d line we would suggest rallies are better to be sold than dips bought until internals improve measurably.

NASDAQ 52 week high lows:


What's been said:

Discussions found on the web:
  1. bdo commented on Jul 18

    great stuff Barry

  2. Alaskan Pete commented on Jul 18

    I love the market internals and breadth charts. It would be instructive to see some longer term versions of these as well. We are basically looking at one advance in these charts as it runs out of steam. Some longer term versions would allow us to examine some prior declines.

    Thanks for posting these.

  3. eightnine2718281828mu5 commented on Jul 18

    Another point: if the market is expecting a favorable resolution to the situation in the Middle East, I’d say that any optimism is misplaced.

    The Bush/Blair conversation caught on the live mic shows just how out of touch Bush is wrt the reality on the ground.

    It’s going to be hard to broker an acceptable conclusion when Bush’s worldview is founded on self-delusion.

  4. william Hughes commented on Jul 18

    I don’t think the Bush/Blair conversation has anything to do with anything having to do with the subject of this excellent post, and it’s inclusion in the above comment suggests the commentator has some sort of political agenda. I invite the commentator to tell us what he knows about the “reality on the ground,” and what sort of “acceptable conclusion” can be brokered by whom. Lastly, I would like him to tell us what Bush’s worldview is, so I can decide for myself whether it is one I agree with. After all, Bush can be right for the wrong reasons. Fred C. Dobbs

  5. Detroit Dan commented on Jul 18

    Bush can be right for the wrong reasons

    I’m afraid that’s about the best we can hope for…

  6. emd commented on Jul 18

    I really enjoy your technical posts. Please keep them coming. I’m learning a lot.

  7. David Sternfeld commented on Jul 18

    Ultimately market prices are determined by the increase/decrease of credit vis a vis the supply of goods and assets, and the moving fulcrum between optimism and pessimism.

    With central bank rates rising slowing credit/monetary growth coupled with falling real incomes and asset prices, the markets are displaying clear signs of failing confidence presaging recession. Further evidence may indicate far harder times than are now disclosed by progressively weakening current prices, MACD and volumes.

  8. eightnine2718281828mu5 commented on Jul 18

    I don’t think the Bush/Blair conversation has anything to do with anything having to do with the subject of this excellent post

    I thought maybe the fact that all the news/business channels have prominent graphics featuring ‘The Crisis in the Middle East’ meant that the topic was weighing on the market.

    The response was also an odd sort of post; in the first sentence I’m castigated for being (in Fred William C. Dobbs Hughes’ eye’s) off-topic, and following quickly thereafter I’m invited to expound further on the off-topic.

    If you don’t mind, Fred William, maybe a quick equipment check is in order; I believe your axe may be showing…

  9. tnp commented on Jul 18

    not sure what the crisis is …….
    Hezbollah getting their %^$%^ ‘s handed to them is a long term positive and a miscalculation by those Iranian monkeys

  10. EdE commented on Jul 18

    i think monkeys would dislike that comparison

  11. mh497 commented on Jul 18

    People still watch the Nasdaq?!

  12. eightnine2718281828mu5 commented on Jul 18

    This is for Fred William, who has expressed an interest in these matters…

    A UN report released today says over 3,000 civilians were killed in Iraq last month, and nearly 6,000 in May and June combined. Link to report text at Reliefweb, and here’s an excerpt:

    Insurgent, militia and terrorist attacks continued unabated in many parts of Iraq, especially in Baghdad and in the central and western regions, with an increasing sectarian connotation. A total of 5,818 civilians were reportedly killed and at least 5,762 wounded during May and June 2006.(1) Killings, kidnappings and torture remain widespread. Fear resulting from these and other crimes continued to increase internal displacement and outflows of Iraqis to neighbouring countries. The negative effect of violence on professional categories, targeted by sectarian and criminal violence or displaced as a result, coupled with inadequate provision of basic services, also affected the level of education and health care received by the population. Women, children and vulnerable groups, such as minorities, internally displaced and disabled persons continue to be directly affected by the violence and the ongoing impunity for human rights violations. Organized crime and corruption have persistently added to the overall insecurity.

  13. AInC commented on Jul 18

    eightnine …………

    interesting …… who cares ?

  14. eightnine2718281828mu5 commented on Jul 18

    Why, Fred William cares.

    And most likely the families of the 6000 dead.

  15. eightnine2718281828mu5 commented on Jul 18

    Gee, Kudlow’s current segment is ‘Warfare and Wall Street’.

    So let’s add Larry (and maybe the market) to the ‘who cares’ list.

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