Midday Check on Market Internals April 14

Apr 14, 2010: 12:29 PM CST

With the day half-over and the market surging to new recovery highs in “Popped Stops” breakout mode after breaking comfortably above 1,200, let’s take a quick look at the state of Market Internals.

Are they confirming the rally?

(Click for full-size image)

The short answer is “Yes” in terms of Breadth and VOLD (though TICK is forming lower extreme/spike highs and hasn’t quite made it over 1,000 today).

Breadth (Advancers – Decliners) just made new highs above 1,400 (confirming the higher highs) and VOLD is surging up all day (as a result of positively skewed breadth) to highs not seen since April 9th’s close – a confirmation.

I don’t yet know what to make of the TICK not spiking above 1,000 – it could be that stocks are just steadily drifting higher instead of being jammed up by by programs at specific times – sort of like a slow ‘melt-up’ instead of a quick ‘jab’ here and there.

As I’ve been telling subscribers in each night’s Idealized Trades Report (in the ‘Forecasting Tomorrow’ section), price is in a “Rally at ANY COST” mode and that any break above 1,200 ($120.00 in the SPY) should be scalped long/bought intraday in an expectation for “Popped Stops” (an expected Short-Squeeze that we see happening today right on schedule as bears are forced to buy to cover).

That’s the mode we’re in now – so far it’s a Type III Trend Day up in pure “Popped Stops” and Breakout Mode.

Expect that to continue unless we see any sort of breakdown in the 5 and 15 period intraday 20 or 50 EMAs… otherwise price is likely to keep bouncing off these levels as it’s done all morning.

The next level of major resistance above 1,200 is 1,225 so it’s possible we’ll see a ‘magnet move’ up to 1,225 as a result in the next few days … if there’s no surprises for this Options Expiration Friday!

Refer back to my March 25th Post:  “Pure Price Tendline Look Reveals Boundaries and Positive Feedback Loop” which correctly noted the “feedback loop” we’re seeing currently.

Here’s a quote from the post:

“So the loop is… bulls buy, bears cover, more bulls buy, more bears cover, even more bulls buy, even more bears buy… and so on until the loop is broken.”

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

14 Comments

14 Responses to “Midday Check on Market Internals April 14”

  1. terlyn Says:

    I thought I saw a Wyckoff sign of weakness this morning.

  2. JeffreyLin Says:

    Who keeps shorting this market and propelling us higher?! Stop poppers is getting ridiculous. May have to wait till next tuesday after options expiration to see where we go? Also earnings'll have gotten under way so some trends may pick up again.

  3. Corey Rosenbloom, CMT Says:

    No, no Wyckoff there. TICK confirmed price's early downswing.

    Popped Stops mode since the open.

  4. Corey Rosenbloom, CMT Says:

    Haha good question! This rally reminds us that ANYTHING is possible in the market (a core principle of Mark Douglas' teachings) and that the market does not HAVE to do anything.

  5. JeffreyLin Says:

    and reminds me of '06 '07 when i first started..and soon after the banks kneecapped the market

  6. terlyn Says:

    Did anyone see Jim Cramer on CNBC? He was jumping up and down telling everyone to get into the market. Despite Corey's post, I just got out of my SSO. I know this was not a technical analysis, although the momentum indicator was turning down, just a gut feeling.

  7. Corey Rosenbloom, CMT Says:

    Haha oh, that Cramer!

  8. terlyn Says:

    I thought I saw a Wyckoff sign of weakness this morning.

  9. JeffreyLin Says:

    Who keeps shorting this market and propelling us higher?! Stop poppers is getting ridiculous. May have to wait till next tuesday after options expiration to see where we go? Also earnings'll have gotten under way so some trends may pick up again.

  10. Corey Rosenbloom, CMT Says:

    No, no Wyckoff there. TICK confirmed price's early downswing.

    Popped Stops mode since the open.

  11. Corey Rosenbloom, CMT Says:

    Haha good question! This rally reminds us that ANYTHING is possible in the market (a core principle of Mark Douglas' teachings) and that the market does not HAVE to do anything.

  12. JeffreyLin Says:

    and reminds me of '06 '07 when i first started..and soon after the banks kneecapped the market

  13. terlyn Says:

    Did anyone see Jim Cramer on CNBC? He was jumping up and down telling everyone to get into the market. Despite Corey's post, I just got out of my SSO. I know this was not a technical analysis, although the momentum indicator was turning down, just a gut feeling.

  14. Corey Rosenbloom, CMT Says:

    Haha oh, that Cramer!