Stock Market Outlook, day trading, index, market outlook, outlook, etf, technical analysis, trading

5 days delay
In order to have access to the most recent market outlook you have to become a member.

Important Note: The "Daily Market Outlook" is delivered to MarketVolume® members by Index-Day-Trading™. MarketVolume® is not responsible for any of the represented information or its delivery to the user. The technical analysis results presented in the "Daily Market Outlook" may differ from the trading signals generated for Exchange Traded Funds (ETFs Signals) or from any other research and analysis efforts shared with our members, since these products developed by independent research teams and delivered to MarketVolume® members. While sharing MarketVolume® proprietary technologies, these autonomous research teams use different systems and may have dissimilar market outlooks.

Index-Day-Trading™ is the first online service to deliver "Daily Market Outlook" with the future short-, mid- and long-term market trends based on volume technical analysis of major US indexes.

Market Stage
(3/15/2010)

On Friday, we suggested that 'Flat SBV readings suggest uncertain market sentiment; traders may wish to wait for clearer SBV signals. However, when we take the large buildup of bullish volume into consideration, we believe the odds suggest a developing correction. Still, it is possible we could see more sideways trading action near current levels (the Dow has already been trading flat since 3/8/2010) before clear bearish signals develop.' Today, we had a largely negative session although the indexes rallied late in the day to close near Friday's levels.

60-day charts with a 20-period SBV are presently showing a small advance in SBV oscillator readings. The following SBV values were found at session's end: Plus 4% on the Nasdaq 100; plus 12% on the S&P 500; plus19% on the Dow. Even though advancing SBV oscillator readings are generally bullish, we do not consider the current circumstances to be a strongly bullish signal: SBV readings are close to the zero-line and there is a sizeable buildup of bullish volume. Overall, this chart setting suggests higher odds we could see more sideways trading action.

1.5-year charts with a 10-period SBV are presently showing flat SBV oscillator readings. While the trend of the SBV oscillator remains positive on this chart setting, the accumulation of bullish volume is still growing; it may push the indexes into an overbought condition.

Market Status
(3/15/2010)

Market Performance:
�

Last

Change

Volume

A/D Ratio

S&P 500

1,150.46

0.56 (0.05%)

3,533,476

1.00

NASDAQ 100

1,920.09

4.34 (0.23%)

563,771

1.06

DJI

10,641.92

17.61 (0.17%)

660,031

1.64

The major indexes traded in the red for most of the day, but yet another rally late in the day erased much of the earlier losses. The Dow managed a small gain, the S&P 500 closed virtually unchanged, and the Nasdaq 100 suffered a small loss. This was the Nasdaq 100's first down-day in 14 sessions!

We now have all the indexes trading at or very close to their January 2010 highs, with the Dow however still lagging the other indexes.

NASDAQ 100 - 3/15/2010. 1-day Intraday, Modulated Volume.

Volume Analysis:
9:30 - 11:15: Today's action on the Nasdaq 100 provides a good example of how a significant accumulation of bearish volume (which appears in red on the SBV oscillator pane) can ultimately exhaust a downtrend and lead to a new upswing. After a modest gap down opening, a one-day chart of the Nasdaq 100 shows that the index trended clearly lower until bottoming out for the day around 11:15. As the market worked its way steadily lower, we saw a strong buildup of bearish volume, with the bulk of the bearish volume production occurring between roughly 11o'clock and 11:20. Note the building of the session's largest bearish volume spike during that time. Also note how the index bottomed out for the day just as the session's largest bearish volume spike came to a peak (around 11:15). A large buildup of bearish volume that occurs as the market pushes lower is often a sign that bearish momentum can no longer be sustained.

11:15 - 16:00: Bearish momentum was now exhausted, and the bulls consequently took charge of the market. Until 14:30 (where the index almost made a fresh session low), the recovery was however very weak. Note that a buildup of bullish volume (seen in green on the SBV oscillator pane) between roughly noon and 13:00 temporarily sapped the market's new upside momentum. An additional buildup of bearish volume between roughly 14:00 and 14:35 however brought some stability and marked an exhaust to the bearish effort. We then saw a strong upside run that lifted the index to a close in the top third of today's intraday range, erasing much of the earlier losses. It was during this final run that we saw the session's largest accumulation of bullish volume (note the two large bullish volume spikes that peaked at 14:45 and 15:30). In review, a five-day chart of the index show that today's session generated a very modest surplus of bearish volume (note the earlier volume surge which was a little more pronounced than the later following bullish volume spike).

Short Term (lasts a few hours to a few days): Last Friday, we struck a cautious note for the market's short-term prospects, saying that 'we see limited sustainable upside potential and a greater risk for a pullback. A likely scenario is a market that tries to edge higher once again, but closes flat or lower.' Today, with the exception of the Dow (which gained 0.17%), the major indexes traded flat (S&P 500) to lower (Nasdaq 100).

There was nothing fundamentally new in today's session in regards to our volume analysis methodology that would change our short-term outlook. 30-day charts of the major indexes still show several significant bullish volume surges (formed during this strong rally); this buildup of bullish volume remains largely 'unprocessed'. Today's volume output was largely mixed (see our volume Analysis section above). We again see only limited (sustainable) upside potential coupled with a greater risk for a pullback. We think intraday advances could be sold down and a likely scenario is a flat to modestly lower market. The approaching options expiration session on Friday could introduce additional intraday volatility.

Analyst's Daily Tip:

Volume surges
Volume surges are evaluated according to their magnitude and duration. It is vital to appraise each particular volume surge before attempting to predict how it might impact future market direction. We categorize volume surges as short-, mid-, or long-term. We also classify intraday surges.

Short-Term Volume Surges: These are volume surges that potentially affect market trends over the short-term (i.e., anywhere from one to several days).
Mid-Term Volume Surges: These are volume surges that potentially affect the market over the mid-term (i.e., from several weeks to several months).
Long-Term Volume Surges: These are volume surges that have the potential to affect market direction over the long-term (i.e., for up to several years).

Charts: Using different views and settings
To put the magnitude of a volume surge into perspective, it is essential to look at more than one chart and use multiple time frames. For instance, while a volume surge may look imposing and seem critical on 1-day or 5-day chart, that same surge may not loom as large on a 30-day chart, and it might even seem insignificant on a 60-day chart. Volume surges that are noteworthy on short-term charts must always be placed in the context of the higher time periods, so that misinterpretations of their potential impacts on mid- or long-term trends can be avoided. For instance, a prominent surge appearing on a 5-minute chart could well affect an index in the short term, but it may not necessarily have much of an impact on the prevailing mid-term or long-term trend.

Financial Press Overview:
In spite of numerous headlines, the market traded without enthusiasm, losing a little and then gaining most of it back in yet another late-day rally. Many market participants are apparently in a holding pattern ahead of this week's meeting of the Federal Reserve. Overall trading volume was thus anemic. The Fed will offer its latest assessment of economic conditions and provide its outlook for monetary policy (interest rates) on Tuesday.

In the early going, the market suffered somewhat, with the periodically resurfacing fear that China is about to tighten its monetary policy in order to cool down its economy.

Among the economic data released today (which however did not affect today's trading to any significant extent), it was announced that February industrial production numbers came in with a gain of 0.1% (consensus estimates: a flat reading). Capacity utilization came in at 72.7%, matching expectations. The Empire Manufacturing Index for March reached a level of 22.9 (consensus estimates: a reading of 22.09); however, while the numbers beat expectations, the result was lower than that posted for February (where a reading of 24.9 on the index had been reached).

A financial reform proposal brought forth by Senator Dodd may have spooked investors in financial (banking) stocks. The proposal suggests stringent policies that limit the amount of risk major financial institutions may take on. In spite of an early setback, the KBW Bank Index ended the day with a 0.2% gain. The broader financial sector lost 0.1% after having been down as much as 1% during the day.

Key economic data for the week starting March 15, 2010. Numbers shown are consensus estimates (market anticipates this value) and prior value.

Tuesday:
	8:30 AM HOUSING STARTS SAAR (Feb): 570K / 591K BUILDING PERMITS SAAR (Feb): 610K / 622K IMPORT PRICE INDEX M/M (Feb): -0.2% / 1.4% 2:15 PM FED RATE ANNOUNCEMENT (Mar): 0.25% / 0.25%

Wednesday:
	8:30 AM PPI M/M (Feb): -0.2% / 1.4% PPI M/M (core) (Feb): 0.1% / 0.3% PPI Y/Y (Feb) (H): 5.1% / 4.6% PPI Y/Y (core) (Feb): 1.0% / 1.0%

Thursday:
	8:30 AM CONTINUING CLAIMS Mar-06: n.a. / 4558K INITIAL CLAIMS Mar-13: 450K / 462K CPI M/M (Feb): 0.1% / 0.2% CPI M/M (core) (Feb): 0.1% / -0.1% CPI Y/Y (Feb): 2.3% / 2.6% CPI Y/Y (core) (Feb): 1.4% / 1.6% CURRENT ACCOUNT (Q4): -$119.8B / -$108.0B 10:00 AM PHILADELPHIA FED (Mar): 17.6 / 17.6 LEADING INDICATORS M/M (Feb): 0.1% / 0.3%

Disclaimer: The "Daily Market Outlook" is provided for education and informational purposes only - they are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice. YOU SHOULD NOT MAKE ANY DECISION, FINANCIAL, INVESTMENTS, TRADING OR OTHERWISE, strictly based on the "Daily Market Outlook". You understand and agree that you are using such information AT YOUR OWN RISK. More...

IDT - Index Day Trading

Using "Daily Market Outlook

(updated on daily basis)