Market Recap - 7/17/2015

The market was mixed today. The Dow Jones Industrial (DJI) closed -33.80 or -0.19%, and the Russell 2000 (RUT) closed -5.74 or -0.45%. In contrast, the SP500 (SPX) closed +2.35 or +0.11%, and the Nasdaq 100 (NDX) closed with a gain of 66.70 or 1.45%. Although the NDX put in an impressive performance today, but the breadth was negative throughout the session. In both exchanges, the NYSE and the NASDAQ, the DVOL lead the UVOL (the charts on the left) and the decliners outnumbered the advancers (the charts in the middle).

(click on the chart to enlarge)



Most of the NDX gains came from some of the large cap tech stocks that have recently regained some of their strength, such as FB and AAPL, and some of the tech names that have reported good earnings, such as NFLX and GOOGL. Next week, AAPL, FB and AMZN are scheduled to report their earnings. Unless one of these companies reports disappointed earnings, the NDX could be tagging the all time closing high of 4704.73. With the present upside momentum, it wouldn’t be surprising to see the NDX put in a new all time high that exceeds the level of 4816.35 reached on 3/24/2000.

The weak market breadth remains to be a concern. While the indexes continue to make new high without stronger breadth, one must be prepare for sudden market reversal. In the meantime, one should refrain from shorting this market as the momentum still favors the longs. As always, manage your risks.