4/6 Journal & Pre-Market 4/7

...Didn't get a chance to post last night.
...Was another kind of depressing day for the major averages, IMO. For a while yesterday it looked like this could finally be the rally. Then everything tanked in the afternoon. All three major indexes made inverted hammer (or finger) formations. All closed down significantly from their daily highs.
...Both the Dow and the S&P remained above their 200 day EMAs, but below their 50 EMAs. The S&P's 50 day EMA is 1188.93. The S&P briefly went above that at 1189.34, but couldn't hold, finishing at 1184.07. Strong triple bottom support remains intact at the 1163 level.
...The Nasdaq once again could not finished above their 200 day EMA. The 200 day EMA is 2012. The index penetrated it again, going as high as 2017, but couldn't hold it. Since the Nasdaq closed below 2000 for the first time on this recent slump on March 18, it has traded between 1968 and 2017. Yesterday was the 2nd time it hit 2017. In 11 of the 13 sessions since March 18, the Nasdaq has ventured above the 2000 level, only to be rebuffed and close below it. It has become very strong resistance. Yesterday, DaBoyz parked the index almost directly on top of that number, at 1999.14.
...Still undecided as to market direction. Nasdaq 1975 support is still intact. But it hasn't been able to get past 2000, and the oversold conditions that were giving hope for a short term bounce have been mostly relieved. Also, we have moved out of the TOM (turn of the month buying period when the 401k and mutual fund inflows from paychecks come in and provide a more bullish scenario for the markets).
...So it looks more bearish to me, but that is normal. I tend to have to look harder to see the bullish case than the bearish one. So I guess that means we'll have the breakout rally today with big volume? Who knows. Still looks weak to me.
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...Nasdaq volume went above NYSE volume yesterday, though not by much. Nasdaq volume was 1.77B shares, not heavy volume, compared to 1.73B on the NYSE. NYSE new highs/new lows improved to 90 new highs vs 21 new lows, but the Nasdaq still was negative at 75 new highs vs 93 new lows.
...The XOI oil index had a nice day. The 850 support held. But it still wasn't able to make it through the latest short term resistance at 873. And the PTB and friends are still trying to talk it down. Saudi Arabia is threatening once again to raise production levels, as if they aren't already cranking, and I'm seeing more articles about oil being in a bubble.
...I'm not using any leverage until the markets show some direction one way or the other. But I am a little heavier invested than I feel comfortable about right now. I'm keeping bearish mutual funds open right now (URPIX and SOPIX) to hedge long trading positions on individual issues. And my stops are set tighter than normal. Trading in these narrow ranges for so long on light volume makes me think that there is a breakout coming. Small ranges lead to large ranges normally, and vice versa. I'd be more inclined to believe the break will be down, but you never know.
...When I first logged on this morning, the futures were up and the articles were bullish advising how the markets would open higher. Then the numbers went down, and the media still hadn't had time to revise their articles. Now the numbers are still down, and the articles have been adjusted to tell us why the markets are mixed. I love it. If you just scan the headlines some mornings on some of the feeds, it is laughable watching them change. And they are always the experts, and always have a reason - even if it is wrong.
...Anyway, happy trading all.