The past week the Nasdaq 100 pushed the stock market deeper down, while the DJI and S&P 500 indexes struggled to recover from the oversold levels (one of the scenarios mentioned in my previous "Nasdaq 100 is behind" post).
If I take a look at my standard chart setting I still see mixed picture:
If I look at 1.5-year chart I see very nice, very huge volume during the index slide in the S&P 500 and DJI sectors. These volume surges are heavier than those that reversed the stock market in March 2008. Based on these volume surges I would say that we could be on the edge of the recovery. On the other hand, the same 1.5-year Nasdaq 100 chart shows almost flat volume during the Nasdaq 100 slide.
So, what I would expect from the market…. Personally I would bet more on the recovery than on the further market drop. Even if we are in the long-term stock market crash, on my opinion the market has to make at least a correction and move up before dropping further down.
If you read my blog, please, keep in mind, that I analyze 1.5-year and 60-day chart not to define mid- or long-term trend. I need more this technical analysis to adjust my short-term trading system to the odds of the general market trend.