Sunday, September 24, 2006

Stockcharts.com: Weekly review

Large caps reverse off 52-week highs while Tech struggles at thier 200-day MAs. What did the Stockcharters have to say about it?

Dr. Joe leads out with a sector review; he has a nice chart of the Amex Pharmaceutical index which is close to a 5-year breakout.



He also has is eye on the Dow Jones Industrial Average using a less volatile monthly chart.



But he tucked has away his best Dow chart on page 2: Note the bearish divergence in slow stochastics; new high in index, lower high in stochastics.



I have marked the 'sell' trigger in the MACD, but if the bullish divergence is breached it would end 4-month support and complete the bearish wedge:



Mitchell Meana highlights another stochastic bearish divergence in the Dow:



But its his bullish/bearish QQQQ chart which shows a potentially interesting development with the head-and-shoulder pattern:




Micheal Winfree points to bearish divergences in the Qs, CCI and MACD histogram:



Robert New always has an excellent leading commentary on his market thoughts:

The market in general continues to struggle at the April/May highs on these indices which has to be expected after such an extended run thus we would not be surprised to see some type of handle form in the days ahead. Look for some choppy back and forth action between our 50 MA's and our key resistance levels over the near term. Volume was quite light on todays pullback. The Nasdaq has very little overhead until the 2300-50 area and should find supports on dips at the 20/50 MA's. Some very nice looking big picture bases continue to take shape so any pullback here is quite welcome. The choppy action will serve to setup many handles/bases in the days ahead.

His Nasdaq charts also points to a head-and-shoulder reversal:




Ted Burge, in contrast, opened with a negative spin:

Demand LOSING control, but there is always an opportunity buying with support and selling with resistance. No one knows what will happen so decide based on support and resistance the level to which you will risk no matter long or short. The only control you have when playing the markets is the control or lack of control over your decisions.

His S&P chart shows where demand kicked in (20-day MA) and where resistance has a solid grip:



Note his comments on the Nasdaq:



So, a (bullish) reversal head-and-shoulder pattern may struggle to follow through, but could find support at 2,164 on weakness. His short term QQQQ chart will be of interest to longs:



Rodney Gorchinsky has marked a similar development in the Dow (60-min):



But his long-term opinion remains bearish:



His long term view on the Nasdaq and S&P are similarly bearish:




An interesting week ahead.

The only chart of interest I could find on the commodity front was illustrated by Jack Chan who has marked in a possible bear flag in GLD:




 
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