Wednesday, April 13, 2011

Daily Market Commentary: Stall at Key Moving Averages

It wasn't surprising to see buyers step in at key 20-day and 50-day moving averages. Although light volume reflected a truer lack of buyer enthusiasm.

The S&P finished on an indecisive doji, backed by a MACD 'sell' trigger.

($SPX)

via StockCharts.com

The Nasdaq rebounded a little, having ducked below its 50-day MA yesterday it was able to close above it today.

via StockCharts.com

While the Russell 2000 dipped down to its 50-day MA at the low of the day before recovering by the close

($RUT)

via StockCharts.com

While the Dow also pegged its 20-day MA with a doji and MACD 'sell' trigger of its own.

($INDU)

via StockCharts.com

The presence of the 20-day and 50-day MAs offered buyers an opening which they kind-of half took, based on the doji candlesticks displayed across the different market charts. However, the indecision doesn't appear to be enough to halt the momentum of bears. Bulls will likely have another crack at it in the morning, but if momentum fails after the first hour then a lower close is the more likely outcome.

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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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