Bears had fun on expiration Friday afternoon! Big picture, indexes continued to fill out range on Friday. On the chart below, it is possible a broader “A-B-C’ consolidation is unfolding. The SPs may well put in a higher low. The DOW continues to fill out range as well – trading sideways as the daily oscillator corrects back down, normally a bullish sign. The summation tick indicator is neutral. The daily breadth oscillators have been working off overbought conditions. Sentiment readings are relatively neutral. Since Friday’s afternoon sell off was in primarily big cap blue chips, Friday’s option expiration might have helped it along. The Russell was able to close outside its recent range and breadth remained positive.
Many markets are in well established uptrends: metals, energies, grains, and even some softs. There is no shortage of liquidity. For Monday: Pinball Buys on Corn and Wheat setup a buying opportunity in the direction of the uptrend. The EC has a 3 bar triangle setup on the daily charts. 137.73 was the previous 120 minute swing high.
At the top of this page, I posted a few weekly charts – not recommendations, but showing a variety of different structure – none showing a distribution top. The overwhelming majority of weekly charts are still constructive. It seems like the market has been consolidating a very short term overbought condition on the daily charts.
Have a great trading week! Last week of the month!