Saturday, August 29, 2009

Exhaustion

As commented recently, it is very important to track market internals data to assess overall market strength/weakness at any given moment. However this data becomes even more important after sustained moves (up or down) since normally will anticipate the trend exhaustion before price confirms it.
Although traditional market internals still show the undeniable strength this bulls move have, some other indicators are already showing exhaustion. Last week, news helped to boost mini-rallies but they were unable to consolidate highs. I wouldn't be surprised if price finds a hard roof this week.

Hi- lo logic index




Zweig Breadth Thrust :




Absolute breath:

Both indicator and its RSI diverges from main indices (QQQQ shown here)