Wednesday, December 09, 2009

Stock Market Commentary: Bulls Take Some Defensive Action

As bullish strength ebbed over the past few days, Wednesday saw the return of some buying. Volume was not spectacular but early weakness was replaced by late afternoon buying. In the case of the Nasdaq this buying engulfed Tuesday's indecision (doji).


And buyers of the Nasdaq 100 were able to regain its 20-day MA:


Better still was the breakout in the semiconductor index which came with a break in the bearish divergence in the MACD trigger line; that potential short play mentioned yesterday is not looking so likely now.


Even the Russell 2000 could surprise tomorrow with a break from its trading range - the small doji is a handy risk:reward marker on the long side with a stop around 592.


Things are nicely poised for bulls to take advantage - but can they do so?


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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