Investor Alert

New York Markets Open in:

Market Sentiment (Stocks on NYSE, NASDAQ, AMEX)

Sept. 26, 2014, 10:59 a.m. EDT

Stock market is undergoing a change in character

Watchlist Relevance

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

or Cancel Already have a watchlist? Log In

About Alexander Elder & Kerry Lovvorn

Dr. Alexander Elder is a private trader and a teacher of traders, based in New York City. He is the author of several international best-sellers, including "Trading for a Living" (1996) and "Come into My Trading Room" (Barron’s 2002 Book of the Year). Dr. Elder runs world-famous Traders’ Camps and is the founder of SpikeTrade.com, a Web site for traders.

Kerry Lovvorn is a trader and a trading coach, whose work has been featured in several books. He teaches advanced trading classes and is a co-author of an e-book "The New High – New Low Index." Kerry is a co-director of SpikeTrade.com, responsible for the nightly market analysis and a trading plan for the following day.

Together, Dr. Alexander Elder and Kerry Lovvorn run SpikeTrade – a unique club where serious traders compete for prizes and share ideas. They can be reached at info@SpikeTrade.com.

/conga/trading-deck/bios/elder_lovvorn.html 196072
The trading deck is powered by

By Dr. Alexander Elder and Kerry Lovvorn

The decline the market has seen over the past several days is not a casual reaction in an ongoing bull market. The market is demonstrating an important change in its character.

The daily new-high/new-low index with a 52-week look-back window sank into its bearish zone after failing to rise into its bullish zone while the S&P 500 made its historic high. That index fell to a minus 269 on Monday, Sept. 22, the lowest level since November 2012.

That NH/NL drop in 2012 occurred during a nearly 9% price drop. On Monday, NH/NL fell even lower just one day after the S&P500 hit a new historic high. This is a very negative change of character.

If the S&P cannot move back up above 2,000, its support levels will be in trouble.

The Russell 2000 index is negatively diverging from the Dow, S&P and Nasdaq indexes. Healthy uptrends are supported by the small- and mid-cap stocks, which now are negatively diverging. The August lows are threatened.

Be sure to protect profits on long positions. Never let a winning position turn into a loss.

Page 1
This Story has 0 Comments
Be the first to comment
More News In
Trading Deck

Story Conversation

Commenting FAQs »

Like & Follow The Trading Deck

/conga/commentary/columnist-competition/looking.html 234011

Partner Center

Link to MarketWatch's Slice.