The Daily Chartist: Beware of the Feeble Bounces - TheStreet

The Daily Chartist: Beware of the Feeble Bounces

Despite Friday's selloff, many stocks are down only a couple of dollars amid average volume. The Chartist says this may not be the best time to buy.
Author:
Publish date:

Oct. 18, 1999

I saw the volatility index get all the way down, just under 30 intraday on Friday, and thought to myself that maybe I'd see some panic in the charts. But that was not to be. So many of the market leaders, mostly in the technology area, were down only a couple of bucks; that is not the type of action you see when stocks get sold out. In addition to the lack of selling in these favorite stocks, the volume was simply average. (High volume with large price movements typically suggests a cleanout.)

So as we sit here at

Dow

10,000 support and 2700 on the

Nasdaq

, there may be some feeble attempts at bouncing. However, the statistics still suggest this is not the time to buy.

New Highs and New Lows

Overbought/Oversold Oscillator

Cumulative Advance/Decline Line

Helene Meisler, based in Singapore, writes a technical analysis column on the U.S. equity markets on Tuesdays and Fridays, and updates her charts daily on TheStreet.com. Meisler trained at several Wall Street firms, including Goldman Sachs and Cowen, and has worked with the equity trading department at Cargill. At time of publication, she held no positions in any securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. She appreciates your feedback at

KPMHSM@aol.com.