Thursday, February 03, 2011

Daily Market Commentary: Trades Near New Highs

For a second day markets finished near Tuesday's highs. The S&P sits on the verge a fresh MACD trigger 'buy' and a new all-time high. Volume climbed to register an accumulation day. For bulls there is plenty of scope for the rally to push on towards channel resistance.

($SPX)

via StockCharts.com

Intraday weakness in the Nasdaq was able to gather support at the 20-day MA. It sits only a few points away from a new closing high, although it remains outside of its former channel.

($COMPQ)

via StockCharts.com

The semiconductor index was able to hold yesterday's breakout, losing just a quarter of a point. Like the S&P, it too has room to run to channel resistance.

($SOX)

via StockCharts.com

Given the relative position of indices inside their channels, combined with a finish which held the upper range of Tuesday's close, chances favour a continuation of the rally. Watch for a morning gap as bulls look to follow through on today's buying.

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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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