Wednesday, January 12, 2011

Daily Market Commentary: Rally Steps Higher

The S&P jumped higher after yesterday's narrow range. Volume climbed over yesterday but it was still relatively light - a mild accumulation day at best. So far, no reason to suggest the rally is done yet.

($SPX)

via StockCharts.com

The Nasdaq gapped higher from the open but was unable to take advantage with an intraday continuation. Rising support remains the cut-off line.

($COMPQ)

via StockCharts.com

The Russell 2000 keeps its upward momentum running inside its narrow channel

($RUT)

via StockCharts.com

But the real winner was the semiconductor index. It gained nearly 2% and finished just shy of channel resistance. Technicals are very bullish with a clear MACD trigger 'buy' above the bullish zero line.

($SOX)

via StockCharts.com

Can tomorrow bring more gains? Or will a retreat offer a buying opportunity? The Nasdaq is closest to rising support, which if tested will offer a good entry point. For large gaps, look for a test of Wednesday's open - but the retrace shouldn't take back more as this would risk a bull trap (false breakout).

Follow Me on Twitter

Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. I offer a range of stock trading strategies for global markets which can be Previewed for Free with delayed trade signals. You can also view the top-10 best trading strategies for the US, UK, Europe and Rest-of-the-World in the Zignals Trading Strategy Leaderboard. The Leaderboard also supports advanced search capability so you can tailor your strategies to suit your individual requirements.

Zignals offers a full suite of FREE 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.

You can read what others are saying about Zignals on Investimonials.com.

JOIN US TODAY - IT'S FREE!

 
f9229fcfd1b1390be00cfccc86c90349c93a4179bf4227457c