09Sep10:29 amEST

The O'Reilly Factor is On

This morning's weakness off the Fed Rosengren's hawkish rhetoric is seeing the S&P 500 Index test its 50-day simple moving average for the first time since early-July. 

We know we have been dealing with a choppy, grinding market at times, since the early part of the summer off the Brexit fireworks. But now comes a good test, as the 50-day is typically a place where buyers who have been patiently waiting to get involved could easily take a stab. So, before we rush into UVXY I am looking to see how the 50-day is negotiated. 

To be sure, some of the short setups we have been noting for Members are acting reasonably well here, such as DHI KO NKE SBUX. 

But, beyond that, a good test should be whether a name like O'Reilly Automotive, Inc. a specialty retailer of automotive aftermarket parts, begins to crack its long-term steep rally. The daily chart, below, reflect a seemingly benign consolidation over the last month. 

Nonetheless, the issue for ORLY is that it is one of those extremely strong, one-way type of multi-year uptrending winners. Thus, in terms of deciphering if the current pullback in the market is something more ominous, I would expect the highlighted daily chart base to resolve lower. 

Elsewhere, gold and Treasuries are decidedly not receiving a safe haven bid, but the U.S. Dollar sure is. 

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