Expecting a short term rally and possibly a medium term trend higher.

From the last post, the market did get a brief rally that turned into consolidation and then finally a probe lower below support today. The Dow did finally touched its 50DMA two weeks ago. When the support levels broke today the major indexes just sold off quickly at the latter portion of the day. There could be more downside tomorrow morning but I now anticipate the short term trend will turn to the upside for the coming days and likely weeks. The medium term could shape up for a 'summer rally' but will have to see whether the major indexes can break above their 52 week highs set last month May.

Short term oversold hints a brief rally to occur soon...

From the last post, I noted that short term overbought sell signals during a bull market tend to give way to the upward momentum at least several more weeks before turning down. And that continued for much for the month of May until the last week when the indexes finally turn down. Also I mentioned that index ETFs will outperform individual stocks as the stock market goes through what is called an 'internal correction.' While the indexes have been down this past week, there numbers of individual stocks have gone through corrections in the prior weeks. Like the rest of global stock market, the corrections have lead to a short term oversold condition hinting for a brief rally to occur soon. The Dow came close to touching its 50 day moving average which has been 5 months when it last touched the 50 DMA. The Dow index could touch it tomorrow, will see. The strength of the anticipated rally will tell whether the stock market will be able to rally back to new 52 week highs or that there will be more consolidation for several more weeks before moving higher again. Will keep you updated either with comment(s) to this post or with a new post... as this develops.