Saturday, August 22, 2009

Weekly Stock Market Commentary: Resistance to the Fore

Another week of gains on typical August holiday trading. The S&P ran up against ascending resistance with the market overbought (but no surprise there); would wait for a MACD trigger 'sell' before getting too antsy if a bull. April 'Buy' signal holds.


The good news came with a long term resistance break for the Nasdaq. It would be good to see a break of the 2006 reaction low but given such a break occurred long ago for the Nasdaq 100 this is not such a concern (for now). March 'Buy' signal holds


Small caps have no obvious resistance nearby and their April 'buy' signal holds


Market Sentiment is operating in real thin air - looking at the Nasdaq Bullish Percents it is hard to see where more gains are going to come from.


The Nasdaq Percentage of Stocks above the 50-day MA is riding a 'sell' signal on a bearish divergence


Same is true for the Nasdaq Summation Index:


It's a conflict between firm bull trends in the indices and strong bearish sentiment. Reason for profit taking but maybe not reason to sell it all.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

 
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