Tonight’s market direction outlook will be shorter than usual as I am working on a number of repair strategies for investors. The market was expected to bounce today. There was a bounce but by the end of the day the entire bounce was pretty well wiped out with the S&P ending up just 0.87 points and the Dow closing down 2.51 points. The NASDAQ closed lower by just 7.76 but in general what is important, is the bounce failed.
This resulted in the S&P setting up yet another doji-cross candlestick which represents strong indecision among investors. The day ended with the candlestick right at the Lower Bollinger Band and below the 100 day moving average.
It would have been better for the market to have closed much higher today which would have set the market up for a continuation of the pullback on Wednesday. Right now, the close left the market indecisive which often means a lower day on the following day, which is Wednesday. However stocks could also try to bounce for a second time since today’s bounce failed. Therefore investors need to be prepared for either outcome on Wednesday.
June 9 2015 S&P
Advance Decline Numbers for June 9 2015
Tuesday saw another 3 billion shares traded which is low volume for the New York Exchange. New lows are climbing. On Monday there were at 127, today they were at 156 and new highs are falling. Monday saw 67 new highs, today just 50. Of the volume traded 53% was to the downside.
Market Direction Outlook for June 10 2015
Technically the market is now oversold and should try to bounce before moving lower. Whatever happens on Wednesday, the outlook is still for stocks to move lower in general. Therefore if there is a bounce on Wednesday it will be an opportunity to put in place more downside trades such as spy put options in my opinion. The doji-cross at the close though is somewhat concerning and my pick would be for a short bounce attempt in the morning and then a move lower taking out the 2075 support level on Wednesday.
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