Monday, August 28, 2006 Weekend commentary

Newsletter, Members Click HereThe market closed the week as it started it, quietly. Suffice to say, there was little change as to what had gone before. The only big change was the sharp drop in volatility, which ran in contrast to the small changes in the tech markets. For the nitpickers amongst you, there were some observations that should be monitored. In the Dow, on-balance-volume is back testing support of the 20-day MA - where before, it was long standing resistance. The index ended the week below 11,324 support, but held 11,285 support - I would consider this a broad, brush stroke of support and wouldn't sweat the small moves inside this range. The S&P wasn't as afflicted by its declines as the Dow, retaining the higher of its two support levels at 1,294. The Russell 2000 didn't produce the bounce off converged 20-day and 50-day MAs it looked ready to do, but neither did it close below these two averages, Monday is another day. The semiconductor index saw a drop in its CCI indicator, falling below the overbought '100' sell trigger line, but the MACD (in particular) and slow stochastics remain strong.

Newsletter update:

RE took its sixth day of losses to close below the most recent reaction low. The July 26th Breakout play closed for a 2% loss. BGFV was a Subscriber pick for August 15th. The play dipped into its breakout gap (and hit the stop), but closed slightly above support, for a 4% loss. SPNC hit its tight stop by 1 cent, to close the Friday play for a 4% loss.