Market Comment 09 15 10

The recent stock market advance off the late August lows has started to show signs of stalling right at the top of the trading range that has contained market action for the past several months. The advance has been on declining volume and the major U.S. indexes are short-term overbought, so a correction or a reversal to the downside at this point could be expected.

(Click on chart to enlarge it for easier viewing)

Notice how the short, intermediate, and longer term moving averages are crisscrossing in the chart below. This represents uncertainty on the part of investors in the market.

We need to have the market decisively break above the trading range to remove some of the uncertainties and give longer term investors more confidence in the market. Until then it will remain a traders market.