Markets are always in search of value. Information comes into the market and can change the behavior of Market participants and that will have an effect of price discovery. Last night information was released on the start-up of the US Economy. That information changed the perception of value in trading today. However, when you analyze the internal structure of the rally, it does not necessarily change the strategy.

Intermarket divergences still exist. Only the NASDAQ has traded above upper resistance. The S&P is at resistance and the Russell has not reached it. Volume is still low and declining. I was a little surprised to see how lackluster volume was in today’s trading. The Indices are moving from extremely oversold to overbought in one trading day, suggesting there are no building blocks of stocks within the Indices. Finally, new highs in both the NYSE and NASDAQ have not budged.

I am looking for some indication of structural strength in this rally. At this point, and it can change, there is none. The analysis will change when the internals change.

DAILY BRIEFING 200417 from Joe Mertes on Vimeo.