June Month-End Recap

  • June 29, 2005
  • Rob Hanna


As I do at the end of each month, here is what I’m seeing in the market
currently:

Positives —

New Highs vs. New Lows —
Breadth has been fairly strong lately.  New high numbers have been solid and new
lows have been weak.  This bodes well for the market.

My expanding watch list — Even
with the sharp selloff last Thursday and Friday, there was still a good number
of charts to go through this weekend.  While some stocks got whacked in the
selloff, the damage for most wasn’t too severe.  I’m still seeing a significant
amount of basing formations that are shaping up and preparing to break out.

UUWNHI (Unofficial Unscientific
Working/Not working Hanna Indicator) — The long side of the market has been much
easier to make money on.  Select breakouts have had nice follow through and
pullbacks have provided opportunity as well.  I haven’t noticed any strong
follow through to the down side.

Neutral —

Foreign Markets — I’m seeing
some strength abroad, but nothing overwhelming.  Last weeks selling in the U.S.
looks like a pullback in most overseas markets.

Negatives —

Sentiment — Sentiment became
overly bullish before last weeks selloff.  While bullish froth has cooled off
some, I still believe there is too much complacency in this market.  I consider
sentiment to be a secondary indicator.  It is capable of remaining excessively
bullish or bearish for a significant amount of time before the market will
react.

Accumulation/Distribution —
Some pretty heavy distribution came into the market on Thursday and Friday of
last week.  Selloffs typically occur on lighter volume in healthy markets.  Any
more distribution in the immediate future could spell doom.

Other

The real wild card in the
immediate future is the Fed.  Tomorrow’s meeting, combined with the fact that it
is the last day of the 1st half, should make for some real fireworks
in the afternoon.  Oil also bears watching.  While I made light of it on Monday,
rising oil prices can put a real choke hold on economic growth.

Happy 4th of July,

Rob Hanna


robhanna@comcast.net

P.S.

Click here for the Hanna ETF Money Flow System.

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