Monday, August 20, 2012

Monday Market Conditions 8/20/12 $SPY $SPX $VIX $VXX $AAPL

Another week, another melt up.  Other than Thursday's jump, the markets were relatively unchanged.  Overseas, Germany is keeping the pressure on Greece to keep up its end of the bailout bargain.  And today Apple (AAPL) overtook Microsoft ($MSFT) as the most valuable stock of all time.

The three-month-long flag is still flying, with a possible resolution date at the end of next week.  Until then, it's entirely possible we keep floating higher.  ATR is back down to April levels (right before the S&P dropped 150 points).  And Stochastics are asymptotically approaching 100.

Fear continues to remain pretty much nonexistent in the market.  The VIX put in a new multi-year low last week, though it closed back above 14 again.

The McClellan Oscillator has begun to penetrate more strongly into the positive side, but it is still a ways from being overbought at +60.  The total put/call ratio (CPC) is creeping dangerously low again.  This points to everyone being on one side of the boat.

-The market still appears to be held up by AAPL & GOOG.
-Financials seem to be rebounding off support.
-Energy sector forming a bit of a rounded top.
-Nice to see Materials finally recovering a bit.

-The jump in the Russell points to more risk-on trades again, confirmed by...
-Defensive sectors such as Utilities showing a lot of relative weakness.
-Rearward-looking Industrials on the move.
-Good sign of a healthy market when the Transportation sector picks up again.

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