Sunday, February 25, 2007

Weekend Commentary from Fallondpicks.com

Newsletter, Members Click Here. To Subscribe - click Bull icon.A relatively uneventful end to the week as another test of channel support in the Dow held into the close of business on Friday. Unfortunately, the heavier volume decline in the Dow registered a distribution day and a MACD trigger 'sell'. The MACD 'sell' signal was enough to create a fresh bearish divergence in the indicator - which in turn, could be the cue to see a break of channel support on Monday. The NASDAQ 100 fell just shy of a breakout, but higher volume at resistance is a sign of (bearish) churning, so there is no guarantee for a breakout early next week. Working in support of the NASDAQ 100 and NASDAQ were the continued gains in the semiconductor index. In the short term the semiconductor index is looking a little rich, but there was enough leg work done by the bulls to shifts its intermediate picture (3 weeks - 3 month outlook) in favor of long positions. This in turn, should translate to gains for the NASDAQ 100 and NASDAQ.

The Russell 2000 posted a minor loss and still maintains its sharply rising (and narrow banded) channel, started late January. The break of the October-February bearish divergence in its MACD remains its key move for the week. The S&P held support of 1,452 and did so without the higher volume churning witnessed in the Dow.

Tech market internals [$NASI, $NAA50 and $BPCOMPQ] were little changed and run in support of January gains in the indices. Because of this I hold to my bullish 30-day outlook for the Ticker Sense Blogger Sentiment Poll.

Newsletter update:

TRLG suffered its second day of declines to hit its February 8th Subscriber stop price for an 8% loss.


 
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