Navigator™ Signals for Day Traders Navigator™ Signals for Swing Traders by 0 Comment The markets left us hanging at the close, as they often do. And that leaves me sitting on my hands for now.The S&P 500 index gave us a nice fade trade off the open, buying the high of the break of the first one-minute bar. But the trade ended at the opening price. As is typical on large gaps, the market went sideways for most of the day in about a 50-point range (Gap Rule #4). Try as it might, the index never got back through and above the opening price, an overall sign of weakness. Also contributing to weakness, the index closed below its 21-day line. But the index spun a bit of a tail, held the 4015 support discussed here, and held the trendline connecting the March 3rd and March 25th lows. The price behavior, then, is a bit ambiguous. It would seem that we still have a sideways, balanced pattern, with repeated “look above” and “look below” attempts that fail. It isn’t easy to discern if the last high was the 5th and final wave of the runup since March 3rd, or simply part of this move across the channel and into the trendline – perhaps still a 4th wave consolidation with a 5th and final wave rally ready to get underway.And that brings me to the NASDAQ 100, which was stronger today, filled its gap, and closed at the top of its daily candle. The NASDAQ 100 behavior and position lead me to believe that the S&P 500 index is, indeed, topping. The NASDAQ 100 remained under its 50-day line, and the price could not get back up into yesterday’s range at all. Despite its relative outperformance of the S&P 500, the weak price action that preceded the NASDAQ landing today somewhat negates any positives. But the NASDAQ 100 held its trendline (though a sloppy looking structure) and still has a pattern of (slightly) higher highs and lows. The Russell 2000 small-cap index held its support lows but has broken its 21-day line and a rising trendline. The Dow remains the stronger-looking index, at least on the chart, and has yet to violate anything significant.I am unmotivated to take any new positions until the picture is a bit clearer. Still, my bias remains that the market has topped and will spend some time sorting through valuations, interest rates, and inflation expectations. Like the pipeline cyberattack, any more black swan events, and you may need to lock me up. Lately, I feel like I am walking around in a moving elevator. I prefer more solid ground.A.F. Thornton
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