9 May 2016 – Earning season near end, market yawns

It was a day of range trading in the indices as earning season near its end. The indices were up pre-market but there was no momentum in either direction. The sectors that have been doing badly such as technology and healthcare did well for the day. Economic report from China indicates weaker import and exports in April. Gold and oil prices fell.

Dow Transportation spent the morning in a narrow range. It made its move upward in early afternoon but sellers sold it down to close with a small doji candle below its 8 EMA. Momentum remains downward. Daily volumetric buying pressure is at 38%.

Dow Industrial attempted to rally on market open but was sold down in the morning session. It grinded its way upward to close with a small doji candle below its 8 EMA. Momentum remains downward. Short term volumetric buying pressure is at 95.1%. The index is in a monthly Squeeze.

Russell 2000 range traded within a small range in the morning session. It broke out to the upside in early afternoon trading but was sold down and closed with a small doji candle below its 8 EMA. Momentum remains downward. Volumetric buying pressure is at 64.5%.

Nasdaq 100 range traded throughout the day and closed with a small doji candle below its 8 EMA. Momentum remains downward. Volumetric buying pressure is at 72.6%. The index is in a monthly Squeeze.

S&P 500 was up pre-market but could not sustain the momentum. It range traded throughout the day and closed with a small doji candle below its 8 EMA. Momentum remains downward. Volumetric buying pressure is at 99.6%. The index is in a monthly Squeeze.

Commodities
Oil (/CL) futures is down at $43.10 per barrel. Gold (/GC) futures is at 1264.8. Silver (/SI) futures is at 16.985. Agriculture (DBA) ETF closed at 20.87. Commodities (DBC) ETF closed at 13.81 and closed below its 200 SMA.

Bonds
High Yield bond ETF (HYG) closed at 82.38. Bonds ETF (TLT) closed 130.86.

Currencies
USD/JPY made further gains and is at 108.40. EUR/USD is at 1.1387. The dollar index (/DX) is at 94.095 as it made further gains.

Relative Strength – Sectors
On a monthly lookback, the ETFs outperforming the S&P 500 are XLU, XLF, XLP, XLE, XLY, XLV, XLB, XLI and XLK respectively. XLP, XLU and XLY shows positive short term momentum.

On a 3-month lookback, the relative strength order are XLE, XLB, XLF, XLY and XLI.

Market Internals
Vix closed down at 14.57. Vix futures is up at 15.45. Skew is at 123.17. Market sentiment is neutral. Market breadth is sloping down as the number of decliners increase. Volumetric accumulation/distribution has flattened.

The Week Ahead
The indices are now trading sideways and seeking direction for its next move. Earnings season is near its end with another week and half to go. It has been a mix earnings season.

The prognosis is that market will continue to trade sideways while waiting for a catalyst to move either direction.

To YOUR wealth!