Market Commentary: Markets Open Higher, SP500 Makes New High, Volume Remains Moderate

Written by Gary

Premarkets were flat all morning, but the markets did open in the green. By the 15 minute mark the SP500 was testing its historic high, the DOW finally moved into the green and the Nasdaq melted up to yesterday’s high.

By 10 am the SP500 recorded a new high (2049.98), Nasdaq was still melting up fractionally and the DOW just isn’t sure it wants to join the party. There are signs the markets are going to continue to perform, but the bull train leaving the station is moving a walking speed.

The bulls are solidly convinced that the market is going to continue upwards, that we will have a Santa Claus Rally and Ms. Yellen will instigate QE 5. The bears and concerned investors on the other hand are preparing for a not so rosy 2015.

Our medium term indicators are leaning towards sell portfolio of non-performers at the opening and the short-term market direction meter is bearish. We remain mostly conservatively bullish, neutral in other words. Right now now I am getting very concerned any downtrend could get very aggressive in the short-term and volatility may also promote sudden reversals. The SP500 MACD has turned flat, but remains above zero at 24.72. I would advise caution in taking any position during this uncertain period and I hope you have returned your ‘dogs’ to the pound.

Having some cash on hand now is not a bad strategy as market changes are happening everyday. As of now, I do not see any leading indicators that are warning of a ‘long-term’ reversal in the near-term. There may be one later in 2015, but any market fluctuations we see now are more of a internal market rectification than a bear market.

Investing.com members’ sentiments are 63 % Bearish (falling from 70% and now rising from 33%).

Investors Intelligence sets the breath at 52.9 % bullish with the status at BearCorrection. (Chart Here ) I expect a market reversal at or before ~25.0 should the direction continue to descend.