Wednesday, November 11, 2009

Stock Market Commentary: Early Gains Unsustainable

Early strength showed promise, particularly for the beleaguered small caps and semiconductors, but endpoint indecision leaves a mixed tone and significant resistance to consider.

On the plus side, there was a net bullish turn in technicals with the MACD trigger 'buy' in the Nasdaq.


The Dow had the early look of breaking channel resistance but by the close it remained contained. The MACD trigger line is up against three month bearish divergence.


Small caps had a mixed day; on the positive front was the MACD trigger 'buy' and stochastic 'buy', but the index itself remained contained by its 50-day MA.


Semiconductors enjoyed a net positive day for technicals, but like the Russell 2000 it struggled to break its 50-day MA.


Of breadth indicators, the Percentage of Nasdaq stocks above the 50-day MA is the only one to have firmed a reaction low on improving technicals - notably today's MACD trigger 'buy'.


If there is to be further gains in the broader indices it will be important for the Russell 2000 and the semiconductors to crack through their 50-day MAs.


Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

 
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