Tuesday, November 16, 2010

Daily Market Commentary: Down to 50-day MAs

Bears pushed the boat out a little further and took indices down towards their 50-day MA.

The S&P gapped below its 20-day MA and never looked back. Look for a test of the 50-day MA tomorrow.

($SPX)

via StockCharts.com

The Nasdaq is also looking at a 50-day MA test tomorrow.

($COMPQ)

via StockCharts.com

The Russell 2000 failed to hold on to the rising channel. A clean break was the result. This has gone from a bulls best hope to an opportune bear trade down to its 50-day MA. Technicals rolling over to boot.

($RUT)

via StockCharts.com

The semiconductor index closed with a bull trap. When the semiconductor index created a bear trap in August the subsequent rally took it back to channel resistance and beyond; will this make it back to 305? Tomorrow's first test is its 20-day MA. Break that and the 50-day MA is next. The good news for bulls is it managed a 'Golden Cross' between 50-day and 200-day MAs.

($SOX)

via StockCharts.com

The next couple of days should see confirmed tests of 50-day MAs for all indices. Indices further away from the mark should make for the better shorting opportunities, although rally attempts back to 20-day MAs will likely be heavily attacked by shorts. Step aside and wait and see what emerges. If you are following my #sectorbreadth tags you can track my sector ideas.

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Build a Trading Strategy Business in Zignals



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 quote 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!
 
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