As discussed in previous Briefings, Friday saw somewhat of a volatile day. Intermarket divergences existed from the open and the last fifteen minutes of trading saw wide swings in the NASDAQ and S&P.

While the Indices remain in a “pause” phase, an attempt to breakout higher on Thursday failed. Concerning to the continuation of a move higher, is the fact the Russell closed at the low of the day, although it is far more extended than the other Indices. The Transports are already in a rotation lower and the Industrials have failed to continue the rally. Additionally, the market structure has not been strengthening. In fact, it has been weakening. These are all reasons to give concern over the continuation of the rally. With that said, any move above resistance followed by strong internals should be bought. Unless that happens, use caution in the next two weeks.

Because of the holidays, volume will be even lower as we approach Thursday’s trading. That can lead to some volatility in price. Use caution for the next two weeks.

DAILY BRIEFING 201219 from Joe Mertes on Vimeo.