NEW YORK (TheStreet) -- As mentioned in Tuesday's article, the fact that the stock market closed down on Tuesday with decelerating volume was bullish on the margin. With that down day on Tuesday, the stock market could resume its upward movement.
Well, Wednesday turned out to be an up day in the stock market, as predicted. The DJIA finished higher by 91.26 points to close at 16651.80 while the S&P 500 was higher by 12.97 at 1946.72. The Nasdaq finished up 44.88 to close at 4434.13 and the Russell 2000 was higher by 8.75 points at 1141.78.
However, a major negative was the up move on decelerating volume, a common theme for 2014. Just as the decelerating volume on the downside Tuesday was bullish, the decelerating volume on the upside Wednesday is bearish on the margin.
The S&P 500 Trust Series ETF (SPY) volume came in over 68 million shares, well below Monday and Tuesday's volume.
Thus, traders should not get very excited about this move on Wednesday. As a matter of fact, the Russell 2000 index, on a green open Thursday, will be well into overbought territory, according to my risk management process.
There continue to be many "growth slowing" indicators in the economy. Macy's (M) reported earnings on Wednesday that were below estimates, and the stock was hit hard, closing down 5.51%. This is just one of many retail stocks that have missed estimates.
This will be another indicator that reinforces the issue that the next GDP report will continue to show a slowing economy.