Thursday, January 08, 2009

Nasdaq stalls as it seeks support

The Nasdaq ran into and reversed from a declining resistance line created by the reaction peaks in August and September; previous resistance lines from September-October and September-November have been breached so this looks to be another step towards a continuation of the "Santa Rally".


Yesterday's wedge breakout cut back below the resistance line and is now looking at the 20-day/50-day MAs for support (on a closing basis)


The picture in the S&P is similar; again, note the disparity in peaks between the Percentage of Stocks above their 50-day and 200-day MAs for May and January - how will this map out with respect to the market?


My expectations are for markets to find support (by closing prices) at the 50-day MAs. Rally is mature for a bear market but it's not dead yet.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website
 
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