Coolhand's Market Analysis

As expected, the FOMC annoucement this afternoon was received with relatively little fanfare and held no surprises. Once it was out of the way the market lifted off its lows and ended the day in moderately higher fashion.

Tomorrow morning we have four economic reports being released before the open (Initial claims, Continuing claims, Durable orders, and Durable orders ex transportation). But there's also a good possibility that the market's tone may already be set after the President's first State of the Union address this evening.

Here's today's charts:



Yes, NAMO and NYMO picked up a bit today due to the rally, but notice that NAHL and NYHL continue to deteriorate. Those are internal markers and may be telling us to be very careful on the long side. All four remain on a sell.



TRIN and TRINQ are flashing buys, but BPCOMPQ continues to drift lower. This is a trend signal and appears to be agreeing with NAHL and NYHL that trouble may be ahead. That doesn't mean a bounce can't happen, but the Intermediate Term does not look good at the moment.




Our Top 50 did not change much from yesterday and our Top 15 (which I'll hold for another day) did not change at all today.

The Seven Sentinels remain on a sell with 5 of 7signals flashing sells and market internals are suggesting more weakness to follow in the coming days. I noticed that the early sentiment poll numbers on Trader's Talk have zero shorts and partial shorts for tomorrow's trading. I'd said bullish sentiment seems to be rising quickly this week as the market has leveled off after last week's carnage. Maybe we bounce heading into the end of the week, but it's certainly not a lock. The caution flag is still waving, and more importantly, the Seven Sentinels do not appear ready to reverse.

See you tomorrow.