Wednesday, January 26, 2011

Daily Market Commentary: Small Caps Excel

It was a day for Small Caps to shine as an almost 2% gain took the Russell 2000 above its 20-day MA. However, the gain wasn't enough to regain former channel support - so while the days' rally looks impressive - the Russell 2000 finished at resistance. There was a consolation, the CCI switched back to a 'buy' signal.

($RUT)

via StockCharts.com

The percentage gain was considerably smaller for Large Caps. However, there was enough of a move to register a new closing high for the S&P. Volume traded was light.

($SPX)

via StockCharts.com

The Nasdaq gained almost a 1% and worked off its 20-day MA. But it sits outside of its former channel and faces the same challenge as the Russell 2000.

($COMPQ)

via StockCharts.com

For tomorrow it could be more of the same. Rallies are intact and 20-day MAs are playing as support. While channel resistance is a factor, because it's rising resistance it's not particularly restrictive.

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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.

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