This is a copy of the “subscriber-only” DecisionPoint Weekly Wrap. It is posted each Friday for our subscribers and wraps up the week by analyzing daily and weekly charts. For more information on subscribing, click here.
Intermediate-Term Price Momentum Oscillator (PMO) signals are determined by weekly PMO crossovers. Additionally, they are only recorded after trading is finished on the final trading day of the week. You often will see an IT PMO signal occur during the week and then on Friday disappear. Since these are weekly readings, it is important to log signals at the end of the week.
Both the OEX and SPX (and the SPY) had weekly PMO negative crossovers which triggered the SELL signals. Both indexes have been forming long-term bearish rising wedges. Additionally, you’ll note that the weekly RSIs are getting overbought. The market is ready for a correction, but we have seen prior weekly PMO declines not amount to much. Just keep it in context that we are seeing this deterioration on the weekly PMOs. The Dow nearly triggered the same IT PMO SELL signal and the NDX has been on a IT PMO SELL signal since April.
