4/25/2023T UPTREND under Pressure Day 19 Market drops hard enough to go into “Uptrend under Pressure.”

4/25/2023T UPTREND under Pressure Day 19    Market drops hard changing showing uncertainty about future

THE MARKET’S MESSAGE:  Support found at the 50-day line. Will it hold?

When the Nasdaq started a new Uptrend with its March 29 follow-through day, I was optimistic! For 3 weeks, the Nasdaq showed strength staying above the Follow-Through (F-T) day.

But after 3 weeks where the Nasdaq never topped its February high, the Nasdaq crashed below its F-T day today.

The good news is the Nasdaq found support at  its 50-day line today, closing at it today. Volume for the Nasdaq was flat and slightly below average which is NOT encouraging news!

Tuesday's market dropped 2%, a concerning sign of market weakness, and enough to degrade the market diagnosis to “Uptrend under Pr essure.”

Today’s Nasdaq price bar now sits on its 50-day moving average line. (At least it is showing some strength by sitting on the 50-day line, not below it.)

The Nasdaq chart over the last week and a half looks like a quiet argument between the bulls and the bears. Let’s expand that thought…..

Note that the Nasdaq rose to the same level at the end of January, hitting that high 2 more times (red arrow). It looks like some big players see that level as “as good as it gets” right now and grab their profits when they can.

I am still very curious about the 3 weeks of quiet volume (see yellow arrow). What is the market waiting for? Another bank to fail?  (I hope not but I actually expect it.)

A quick note on Friday volumes (in case you missed it)

         You will see that volumes on the indexes usually rise significantly on one Friday each month. This higher volume is created by the trades that are created when options expire on the third Friday of each month. Here is a backward look showing the third Fridays in the last 8 months. (They all have them but that chart wastoo squished to be easily read.)

>>> A  LESSON about HIGH VOLUME DAYS caused byOPTIONS EXPIRATION :

·      Don’t be fooled by the high volume options Fridays. It may NOT point to a popular stock. A high-volume Friday may be pointing at an options expiration day. Many options contracts may settle on that third Friday because they are “in the money,” that is they have a value and are worth “settling” to pocket that gain.

But only half (4 of the 8) optionexpiration days closed heavily “in the money.” I know that because only 4 had high volume on those Fridays. Note the golden pointer showing those higher volume days below.

>>> A  LESSON about HIGH VOLUME DAYS caused byOPTIONS EXPIRATION :

·      Don’t be fooled by the high volume options Fridays. It may NOT point to a popular stock. A high-volume Friday may be pointing at an options expiration day. Many options contracts may settle on that third Friday because they are “in the money,” that is they have a value and are worth “settling” to pocket that gain.

But only half (4 of the 8) optione xpiration days closed heavily “in the money.” I know that because only 4 had high volume on those Fridays. Note the golden pointer showing those higher volume days below.

Looking over the MARKET ACTION OVER THELAST 20 DAYS table below, I start with the “Type of Day” column to see ifthere is more serious buying (accumulation days) or more serious selling (distribution days.) In the last  10 days (2 weeks).

The first six trading days on the following table defined both the high (12,221.91) and the low (11,716.08) for the rest of the 20 days (almost one month).

There were more accumulation days (5) than distribution days (3) over the last 20 trading days. But there have been a surprisingly high number of days that had price changes less than 0.2% or had lower volume, both of those criteria make those days “Neither” accumulation nor distribution days.

I look forward to the market getting excited about an uptrend or a downtrend. I don’t care which.  I can make money on both!  When many days are “neither” (count 5 of the last 6 days), I just get frustrated, waiting for the phone to ring!

‍

Reviewing the MARKET FACTORS, COUNTS & RATINGS table below, note there is GOOD NEWS HERE!

·      The market ison the 19^th day of this Uptrend, that’s 3+ weeks.  Note: I usually make more money in an Uptrending market. Don’t you?

·      The RISING/FALLING RATIO OF LEADER STOCKS remains a neutral 1.1 (a little more than 1 rising stock for every 1 falling stock).

·      The Nasdaq Accumulation rating is a B+ (sorry about that D for the S&P500 and  E for the DJIA indicating there are more sellers than buyers.).If you hold some of those lagging indexes, I hope it’s not too much. I don't hold them and suggest you rethink that strategy if you do.

·      NOTE :  The day’s closing price for all three indexes shifted back to “at their 50-day lines – again confirming the higher number of buyersthan sellers in this market

And just for your reference…..

The ACCUMULATION/DISTRIBUTION TABLE tells me that the was a very small dip in the A and B stocks over the last week..  The As and Bs still own 45%of all the stocks – almost half!  That tells me it should not be too hard to find some strong stocks to invest in when I am confident the market is rising again.

Are you registered on the current www.ArmchairInvestor.com site?

If so, you will receive a BRIEF email from me after I post this newsletter each night to tell you, as soon as possible,when it is available for your review. If you don’t get that message, just click on the popup invitation that appears when you go to the www.ArmchairInvestor.com website (the one listed above) and register.

>>>>>I appreciate any feedback you have for me. Please send comments and ideas to:

Editor@armchairinvestor.com

Wishing you, “Many Happy Returns.”

CharlotteHudgin, The Armchair Investor,   (214)995-6702

www.ArmchairInvestor.com   (214)995-6702   editor@armchairinvestor.com  

2023 ACI NEWSLETTER sent via WEBFLOW

C:\Users\charl\Documents\1INVESTING (not marketing)\#ACI Newsletter #######\# 20

‍