Weekly Market Commentary: Rally Continues

It was another week of gains which kept the 2009/10 rally chugging along. For the S&P there is still 27 points on offer before resistance becomes an issue and even then, comparable resistance as playing for Tech is around 1,400 (or 200 points away).

$SPX

via StockCharts.com

For the Nasdaq it was an opportunity to touch the first of two reaction highs from 2008; it's hard to believe stocks are offering valuations based on pre-bank-fail prices??? The February 5th 'Sell' trigger holds

Nasdaq

via StockCharts.com

The Nasdaq 100 did more by breaking past the lower of the two 2008 reaction highs, bringing the earlier 2008 reaction high around 2,022 into play. Can it reach the latter price?

Nasdaq 100

via StockCharts.com

Will the Bulltrap 'Buy' come true? Bullish Percents only a few points from prior high of 75%

Nasdaq Composite Bullish Percent Index

via StockCharts.com

Nasdaq Percentage of Stocks Above 50-day MA fast approaching resistance

Nasdaq Percent of Stocks Above 50 Day Moving Average

via StockCharts.com

As the Summation Index toys with a bull trap breakout

Nasdaq Summation Index

via StockCharts.com

All three of these Nasdaq Breath Indicators are calling a top. The current test of 2008 reaction highs is a good 'sell' signal. Best to wait for better re-entry points later in the year.

Sell in May and Go Away could be a very good strategy this year.

Follow Me on Twitter

Build a Trading Strategy in Zignals; Read how and earn real money (once out of Beta) in this PDF.




Dr. Declan Fallon, Senior Market Technician for Zignals.com, offers a range of stock trading strategies for global markets, also available through the latest rich internet application for finance, the Zignals MarketPortal or the Zignals Trading Strategy MarketPlace.

Zignals offers a full suite of financial services including price and fundamental stock alerts, stock charts for Indian, Australian, Frankfurt, Euronext, UK, Ireland and Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active stock screener with fundamental trading strategy support and trading system builder. Forex, precious metal and energy commodities too. Build your own trading system and sell your trading strategy in our MarketPlace to earn real cash. Read what others are saying about Zignals on Investimonials.com.

JOIN US TODAY - IT'S FREE!

Popular posts from this blog

S&P "Bull Trap"?

Image
I thought there was sufficient evidence to argue against a "bull trap" in the S&P, but it would appear the market wasn't interested in such thoughts and sellers were quick to reverse the initial push above 4,200.  Adding to the pain were new 'sell' triggers in MACD and On-Balance-Volume, although the former occurred above the 'bullish' zero line, making it a weak signal. Selling volume ranked as distribution as selling momentum picked up speed.  The index is also underperforming relative to the Russell 2000. 
Read more

"Black Candlesticks" are a concern for the S&P and Nasdaq

Image
A bright start for bulls on the back of positive $NVDA earnings wasn't enough to generate a day of meaningful gains.  However, it did help stall the losses of the last couple of days. The Nasdaq was the biggest beneficiary of today's action, but not enough to see an end-of-day finish that cleared last week's swing high, nor delivery of a large white candlestick, despite the morning breakout gap.  Technicals are net bullish and relative performance against the S&P has become consistently stronger since the start of May.  While today's candlestick I would view as typically 'bearish', today's volume ranked as confirmed accumulation (bullish). Overall, I would be looking for higher prices from here. 
Read more

Round 2 for the bearish "black" candlestick in S&P and Nasdaq

Image
The Nasdaq started brightly but ended up closing below its open price, but above yesterday's close. The S&P did something similar, although the intraday range is narrower. These two setups are somewhat complicated by the new 'buy' triggers in On-Balance-Volume for both the Nasdaq and S&P. And the new MACD trigger 'buy' for the S&P. Price action is key, so I would expect the candlestick to trump the technical picture; watch for lower prices tomorrow.
Read more

Archive

Show more