Friday, December 18, 2009

Stock Market Commentary: Breakouts Fail

Markets broke out - tettered - then break down as attempted pushes to new highs reversed markets back into their prior ranges; the bad news for bulls is failed breakouts typically travel in the opposite direction very quickly. The Nasdaq is hanging on to its 20-day MA with channel support and the 50-day MA nearby to lend a hand; but if the latter break then it will be a smart run to the exits.


Large Caps are looking more vulnerable; Dow has already lost 20-day MA support and hasn't yet made a test of its lower channel.


Small Caps haven't entirely given up the ghost - but the breakout is looking very shakey. Converged 20-day and 50-day MAs will be important to hold.


Semiconductors are also doing their bit to keep bullish momentum rolling.


But it's hard to be optimistic for the S&P; there is a huge void down to the 200-day MA.


What will Friday bring?


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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