Daily Market Commentary: Semiconductors Carry Weight of Indices
($SPX)
via StockCharts.com
The Nasdaq closed with an inside day of an inside day, right above its 50-day MA. This tight coiling action typically unwinds with a sizable move. Two days of distribution in three suggest this move will be down.
($COMPQ)
via StockCharts.com
Lending weight to the "next move is down" story was the clean slice of the 50-day MA by the semiconductor index. It's a worrying because everything above 445 is now supply. It also pushes the index into a no-mans land between 50-day and 200-day MAs.
($SOX)
via StockCharts.com
The same vulnerability exists for the Nasdaq 100 at its 50-day MA as does for the Nasdaq.
($NDX)
via StockCharts.com
Thursday's morning trading may be very tentative, especially in the Nasdaq and Nasdaq 100. Bulls will hope the semiconductor index can catch a bid and regain its 50-day MA, but hope is a dangerous game in trading.
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