Stock Market --Technical

The SP 500 popped up enough last week to set up a challenge of the
downtrend in force over the past two months. For trend followers,
there is promise but no confirmation of a positive reversal, either
short or intermediate term. In fact, 13-14 wk indicators are still
negative.

We have had three legs down on this correction, so the challenge
of the downtrend line ahead may be more forceful. I must say,
however, that I very much dislike seeing a week end with a challenge
in view only to see it be postponed. That will prompt some trend line
traders to have reservations.

My NYSE buying pressure index has not broken down, and the
selling pressure index has failed to sustain a rise. When I look at
advances vs. declines on a rolling six wk. basis, there is net
accumulation underway, but there is nothing smooth about it. As
the chart link below shows, the cumulative NYSE adv / dec line
has held support well, has broken through its downtrend line and
is just turning positive on MACD. I am also heartened by the
dramatic improvement in the TRIN last week following an
extended interval of capitulation.

In short, the market is getting close, but has yet to earn the cigar
in the near term.

NYSE A /D chart.