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Friday's Close Could Confirm Negative Weekly Charts

NEW YORK (TheStreet) -- Trader and investor whiplash continued this week, exemplified by the stock market reaction to Friday's January employment report. Dow futures traded between down about 70 points and up 80 points as nonfarm payrolls grew by a less than expected 113,000 with the unemployment ticking down to 6.6%.

Stock market volatility is not surprising as 77% of all stocks remain overvalued, according to www.ValuEngine.com, with 35.2% overvalued by 20% or more. All 16 sectors are overvalued with only four overvalued by more than 20%.

Here are the points of volatility for the five major averages:

The Dow Industrial Average (15,629) closed below its 200-day simple moving average at 15,488 Monday through Wednesday, but moved back above it on Thursday after setting a 2014 low at 15,341 on Feb. 5. The other major averages stayed well above their 200-day SMAs.

The S&P 500 (1773.4) traded to a 2014 low at 1,737.9 on Feb. 5 well above its 200-day SMA at 1711.4 then on Thursday rebounded back above its semiannual pivot at 1763.4 with a second semiannual pivot at 1797.3.

The Nasdaq (4057) stayed well above its semiannual value levels at 3930 and 3920 with a 2014 low at 3968 on Feb.5 well above its 200-day SMA at 3755.

The Dow Transportation Average (7182) traded to a 2014 low at 7010 on Feb. 5, well above its 200-day SMA at 6717 then rebounded back above its quarterly pivot at 7086 with semiannual pivots at 7245 and 7376. This morning Dow Transports is above 7245.

The Russell 2000 (1103.93) traded to a 2014 low at 1082.72 on Feb. 5 staying above its 200-day SMA at 1062.07, and its rebound has been below its semiannual pivots at 1130.79 and 1133.29.

The whipsaw pattern has been influenced by pivots that I have been describing as a tangled bowl of spaghetti. Even so, I expect all five major averages to eventually decline to their 200-day SMAs at some point in 2014.

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