Stock indexes lower, Commodities rebound, Dollar back near lows

indexes0326.pngI’m getting this post up very late, so I’ll make it short. The stock indexes fell back today. The Nasdaq had been the strongest during the session, however right at the closing bell when Oracle reported the Nasdaq fell lower than the chart to the left (which is the day session only) would suggest. The small range, indecision bar left yesterday and the failure of a rally today shows to me that stocks auctioned up just to attract sellers, and that it is quite possible to have another attempt to re-test, to see if buying will still come in at support. That double bottom got a lot of attention, which makes me worried. And the volume was diminishing on the rebound. I drew horizontal lines where there was a spike and rejection at the January lows. I know they are drawn slightly in different places. The Nasdaq/QQQQ was more clearly defined as a buying tail on the second day of the drop, whereas the SPY had a two day drop, but with a higher bottom on the second day. However the lines are drawn, the important conclusion the way I read it is that prices started to accept the values in the lower areas on the re-test, especially in the S&P/SPY. This set-up seems backwards, as there is usually more activity on the initial low, and then the re-test is more of a sharp and quick spike down that quickly gets rejected. This time the market spent a lot of time accepting that low area. The low may be in, but it looks suspicious at the moment. A further rally over the recent highs and then a successful re-test of that break-out point would end the debate, and I’d have to put some sort of bull back in the box in the upper left.
The dollar sank back near the all-time lows today. This caused a rebound in many of the commodities that had fallen sharply in recent sessions. I would think this is just a bounce in gold and oil. Of course if the dollar makes another leg down then gold, oil, and the grains could test their highs. The oil and corn markets have already made more than a 50% correction back up, with the others lagging behind.

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