The NAZ continues to be the strongest and healthiest of the averages, keeping both the DOW and S&P afloat.

The NAZ is technically a very healthy average as it continues its steady move higher, moving in lock-step with the now up-trending and parallel 20 & 50-Day MA’s.  The NAZ has also held nicely above its 50-Week MA for three (3) straight weeks.  AND…! Today the NAZ bounced nicely off of its 20-Day MA after a healthy two (2) week consolidation.  All very healthy signs indeed.

If this recent overall strength is to have any staying power, its the NAZ that will need to lead the way, because it appears that both the DOW and S&P are in a real danger area right now…  stuck just under a still declining 200-Day MA, as well as below their respective 50-Week MA’s.  And just as they were both heading into possible golden (bull) crosses of their respective 200-Day MA’s.  

Breaking back below their respective 20 & 200-Day MA’s after spending the past 2.5 weeks above them muddies the picture at best.  Volume is drying up as we approach summer and there simply may not be enough buyers out there to overcome this significant overhead trend resistance still in place.

Without a clear upward trend supported by the following trend-lines, holders may decide that there simply isn’t enough strength to stay long into the summer and begin to dump, perhaps triggering another leg down when we were just beginning to think things were looking up…  bummer.

Watch the action closely as the DOW and S&P battle along their 200-Day MA’s over the next couple of weeks. I suspect we will see the development of our near-term direction over the next week or two.

Coach BD

 

06/17/2009 at 1:20 pm
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