Chart Courtesy of Thomson/Reuters Keep an eye on the five major averages as additional weakness into Friday's closes could provide technical warnings for the stock market. The major equity Averages ended Wednesday straddling their five-week modified moving averages at 15,362 Dow Industrials, 1669.6 S&P 500, 3566 Nasdaq, 6440 Dow Transports and 1026.63 Russell 2000. Both the Dow Industrials and Dow Transports closed Wednesday below their averages, which would shift their weekly chart profiles to neutral, if not negative.
Weekly momentum readings are overbought for Dow Industrials, S&P 500, Nasdaq and Russell 2000. The reading for Dow Transports is flattening at 74.22 below the overbought reading of 80.00. With the stock market still under a ValuEngine valuation warning, all we would need is weekly closes below all of the five-week modified moving averages, with momentum declining below 80.00, to have a confirmation that the early August highs are cycle highs. This seems highly unlikely this week for the Nasdaq and Russell 2000. I do not own Apple shares. At the time of publication the author had no position in any of the stocks mentioned.Follow @SuttmeierThis article was written by an independent contributor, separate from TheStreet's regular news coverage.