Tuesday, March 22, 2011

Daily Market Commentary: S&P Hits Resistance at Converged 20-day and 50-day MAs

Minor losses helped markets hold the bulk of yesterday's gains. Light volume also kept selling intensity low.

The S&P stalled at converged 20-day and 50-day MA resistance. Aggressive shorts might play this, but there is still room to run to declining resistance so it's not a clear cut opportunity.

($SPX)

via StockCharts.com

The Nasdaq is neither near channel or moving average resistance; room for more gains?

($COMPQ)

via StockCharts.com

Meanwhile the Russell 2000 touched channel resistance but the 20-day MA has held as support. It would have played well as a straight channel support to resistance trade. Can it now play to the downside; resistance to support? A break of resistance would turn it into a long trade.

($RUT)

via StockCharts.com

Today's narrow trading offers a couple of short term opportunities. Stops can be set relatively tight; swing trade break of Tuesday's high/lows with a stop on the flip side.



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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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