Tuesday, January 16, 2007

Weekend Commentary from Fallondpicks.com

Newsletter, Members Click HereThe long weekend likely contributed to the lower volume traded on Friday, but all-in-all it was a good week for the bulls. Solid breakouts in the NASDAQ, NASDAQ 100, Dow, and S&P have reinstated the bull market and put some pressure on the weak technical pictures supporting these indices. Chief of which were the across the board MACD bearish divergences - now pressurized by NASDAQ and NASDAQ 100 MACD trigger 'buy' signals, and resistance test for the Dow. The Russell 2000 was the only index not to break to new highs, but it is moving in the right direction after reversing its break down through the 20-day and 50-day MAs. The semiconductor index also recovered from its unusual one-day reversal in the face of broad gains for the Tech averages [NASDAQ and NASDAQ 100].

Unfortunately, tech market internals [$NASI, $NAA50 and $BPCOMPQ] remain weak with a bullish cross of the 5-day EMA in the $NASI and upswing in the $NAA50 the best thing to come out of Friday's action; the latter at least went some way to presuring (but not breaking) bearish divergences in the supporting MACD and Ultimate Oscillator. Volatility is in the process of back-testing wedge support (former resistance) and looks set to rise once more - spicing up the action over the coming week.

I remain bearish for the Ticker Sense Blogger Sentiment Poll - the market may be up, but decent individual stocks are hard to come by.