MPT Rating (02 Weak Bear)

7. July 2008 by admin.

Monday, July 7th, 2008; MPT Rating (02 Weak Bear) 

The markets were all over the place today, but did nothing as the volatility is in anticipation of second quarter earnings which kick off tomorrow and I would anticipate we will see a major bounce soon as the markets can not sustain these oversold conditions without new bear fuel, and for the first time in a few days I started seeing the news show a bullish bias, thus I do anticipate the bulls to recover this sell off in the second half of this year.

The DJIA closed off 56 points for the day, and those looking at the RSI indicator shown on the attached chart can clearly see we are heavily oversold and will get a bounce, just as heavily overbought will require a sell off.

The NASDAQ closed down 2 points for the day (might as well have taken another market holiday); today’s activity is just the flexing of muscle before second quarter earnings get underway and as I have discussed with members, we already know how that will play out.  The RSI indicator for the NASDAQ is currently reading 30.74; can it sell off a little more? Sure.  Can the market sustain these oversold prices? Not a chance.

Today’s MPT (Market Power Trend) Rating, which tells us what “Smart Money” is doing in the market today and what to expect with the overall market tomorrow, came in at (02).  This MPT Rating is likely not worth much as today’s activity was based on light volume ahead of earnings which resulted in a wash of direction for the day, but the (02) reading is the weakest bear indicator we have, and this typically mean early morning selling met by a bounce higher as the MPT Rating will begin showing base signals, followed by “Smart Money” buying.

As always I recommend investors and traders, be smart, patient, and ever successful.

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