Since about the middle of April, the Nasdaq and Nasdaq 100 appeared ready to rollover several times only to hold a previous low, rally on lower volume, and stall near or at the fifty day moving average. The DOW, NYSE, and SP 500 have attempted to breakout to fifty two week and all time highs on diminishing volume only to stall or sell off in heavier volume.
The last three days have followed a similar pattern. After a major distribution day on Thursday, the market has mustered a two day rally on diminishing volume, including expiration Friday.
Leading growth stocks have been unable to muster any strength or confidence either. Few stocks have been able to setup near fifty two week highs. Those that have attempted to breakout or move into new highs have done so in below average volume with lagging relative strength lines. The remaining stocks are mired below or on the verge of falling below the fifty day moving with no ability to rally above or off the moving average with any strength.
With an upcoming holiday weekend it is doubtful anything exciting will occur until afterwards. Expect the Nasdaq to attempt a test of the fifty day moving average and recent range highs, and the NYSE, DOW, and SP 500 to test fifty two week and all time highs. If volume is low, or higher and the market stalls, this could be a strong indication of another wave lower. Of course, leading growth stocks could use this time to work their way up the right side of their consolidations in higher volume and soften any major selling in the market after the holidays.
With so little follow through in either direction and too many shorter term setups being nothing more then bull or bear traps that reverse back into consolidations the same day they attempt to breakout or breakdown, traders continue to be better off on the sidelines waiting for leading growth stocks or short trading ideas to tighten further before attempting to trade. Cash really is a strong position in obscure markets.