S&P 500 Index (SP500)

[DiscoverGold]

Trading Notes: Wednesday, February 3rd
By Brett Steenbarger, Ph.D.

* February 3, 2016

* Tuesday's trade in ES nicely illustrated the dynamics of a downside trend day, including an opening price near the high price for the day session; negative NYSE TICK dominating positive readings, with many readings < -800; a very negative advance/decline line; and a great majority of NYSE stocks trading below their VWAPs for the day. Trend days often feature above average volume, as directional, macro participants express an intermarket theme. In yesterday's case, we saw the resumption of the risk-off trade involving oil, stocks, high yield credit, and emerging markets. I am watching those intermarket relationships carefully from day to day.

* A useful short-term overbought/oversold measure is a five-day moving average of upticking vs. downticking among NYSE stocks. Note how we reached a short-term peak recently.



http://traderfeed.blogspot.com/2016/02/trading-notes-for-week-of-february-1.html

• George.

Click on "In reply to", for Authors past commentaries.