The week ahead 10/03 - 10/07.

Last week could have been the week the bulls wished never happened.....The strong Nasdaq is now turning weak; they broke their daily uptrend and now closed back below their 150 day smooth moving average.  The S&P, Dow Industrials, and Dow Transports cannot sustain trade above their measly 10 and 20 day moving averages and are getting awfully close to their lows of the year.  That is bearish action and the bears seem to be in full control of this trade.

I am looking at last summers range when me made the lows for the year.  I think that last summer's range is important; if the market cannot sustain trade above that range then it becomes a good possibility that they test the bottom of that range.  

On Friday the S&P cash closed almost dead on the top of last summer's range (1131.23 was the top of the range and they closed at 1131.42).  The Dow Industrials and Nasdaq futures are still trading above theirs, while the Dow Transports (our downside leader) are trading near the bottom of last summer's range (getting close to last years lows).

When the Transports remain weak the rest of the market seems to drift lower (even the Nasdaq).  With a bearish Dow Theory Confirmation and a recent break down in technicals in the Nasdaq the market still seems to be searching for a bottom.

See charts for more thoughts on the week ahead......

Moving Averages; Black (10 day), Blue (20 day), Green (50 day), Pink (200 day) Purple (150 day smooth avg.).  Horizontal Lines; Blue (High of the year), Red (Low of the year), Green (Unchanged for the year, Black (last summers range)

$SPX

$NQ_F

$DJIA

$DJT

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