Tuesday, April 21st. - Stock Trends, Charts, and Commentary (*** If you see last week's Tuesday Update: Click Here)
Clear Sailing ahead or Not?
It happened yesterday ...
Yesterday, all 5 of our indexes closed above their resistance lines as seen below. The five indexes included the Institutional Index of "core holdings", the NYA (NYSE) Index, the SPY, the NDX, and the IWM.
Up until yesterday, the laggard had been the NYA Index, so it appears to many that the obstructions have been removed. But, not so fast ... see the second chart ...
The second chart below is the remaining hurdle that investors should be respectful of. Until that index clears its hurdle, all investors should remain optimistically cautious.
Let's look at this last index now and identify it. It is the Dow Jones Transportation Index. Take a quick look at this chart and what do you see?
First note the square box area that I drew on the chart, and then notice where the index closed yesterday. The boxed in area shows a trading range that the Dow Jones Transportation Index has been stuck in since last October.
Second, note that yesterday's close was at 8793.70. When you look at the boxed in area, it you will see that yesterday's close was definitely in the "lower half" of the trading range (boxed in area).
So at the close yesterday ... all of the above indexes above closed beyond their highest resistance lines, BUT the Transportation Index remained well behind.
Why point this out?
Because it has a lot of Dow Theorist nervous and scratching their heads. Then reason is that they won't accept a new up trend in the market until it is "confirmed" by the Transportation Index making a new high ... and that is a ways off right now.
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