The Zweig is now 26 days since being either overbought or oversold. although not that unusual it is the longest since the March 9th rally began and is another indication that this market is changing.
We are rounding the corner here on the way down. The RUT was the strength today although all three put in lower new highs. It would take a strong open tomorrow to pull these back up. Usually we would get a couple more up days in these cycles so a two day stutter here is not out of the question, but again it will take some world wide help overnight to turn the ship back around.. for now it looks like down..
The momentum is now officially gone in the 10 Day High-Low. This mornings opening pretty much took care of that. We should new drift lower before regaining upward momentum. This indicator however could use an extra day here. You can see in the middle of November where it skipped a beat for a couple of days before resuming some upward momentum.
Tomorrow's selling is key.
Our 40 DMA %'s did not cross over their 20 day moving average putting this signals into a score of 0 or neutral. Look how strong the RUT and NQ are compared to the NYSE which is currently correcting harder than the others (but it is at 58% of stocks over their 40 DMA compared with the NAQ and RUT whcih are 44.90 and 49.95 respectively.
While the NYSE clearly shows weakness compared to yesterday, the NAZ and RUT are showing some surprising strength in there. The NYSE one minute ticks are currently in an uptrend, while the other breadth indicators have moved from bullish to bearish based on the weak opening.
The strength today is in the RUT while weakness is in the DOW which was in a need for a good correction.
The ES 1096 area is today's demarcation line.
Germany over the last few day has produced some fairly weak and disappointing economic numbers. It's month over month factory order numbers showed a decline of -2.4% and when charted shows a steady decline from the summer top.
This certainly sets-up worries of a second dip here and tell us that the economy in the Euro zone are perhaps not as strong as originally thought.
Last night, or for us east-coast Americans at 6:00 am NYSE time, the German industrial production month over month numbers came out confirming yesterday's weak factory orders. The expected number was already a weaker number with a predicted expansion of only 1% in factory production. The number came in not has an expansionary number but contraction, a cold -1.8%.
Germany and France were the first to declare to be out of the recession, now the question is are they falling back in or is this just a stutter during the recovery with America now pulling up the rear and we will all lift here soon? We need to watch our own numbers
One thing it does mean, no interest rates hikes in Europe yet and if America does continue its recovery it will do so with a stronger dollar. Stronger dollar equals lower oil, gold, stocks.. at least in the short term until the shackles of co-dependence are broken.
