Daily Market Commentary: Bullish Recovery

The wild daily swings in the market continued as bulls made their stand following Friday's selloff. Monday's buying helped maintain March swing lows for the Nasdaq, Nasdaq 100 and S&P.

The S&P opened a few points above its 200-day MA and was able to rally back to its 20-day MA before sellers emerged late afternoon. The index is well poised to make further gains tomorrow.

($SPX)

via StockCharts.com

The Nasdaq made stronger inroads on Friday's selling and was able to finish above Friday's open price; the Nasdaq may be the index for bulls tomorrow. The 50-day MA at 2,763 is the next upside target.

($COMPQ)

via StockCharts.com

The Nasdaq Bullish Percents strengthened the swing low with a MACD 'buy' signal to follow the earlier CCI 'buy'. Improved technical strength was in combination with a crossover in the 3-day x 5-day EMA. Another factor favoring further highs for the Nasdaq tomorrow.

Nasdaq Composite Bullish Percent Index (EOD) ($BPCOMPQ)

via StockCharts.com

Small Caps are not to be ignored with 50-day MA and channel resistance the next upside targets for the index.


Tuesday will offer bulls the best chance to break out of the congestion of the past couple of weeks. Further gains will help convert 20-day MAs into support. A day of losses will only keep traders guessing for another day as to the eventual direction markets will take. Today's post on Quantifiable Edges suggests bulls will benefit in the coming days.

Follow Me on Twitter

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.

Zignals offers a full suite of FREE financial services including price and fundamental stock alerts, stock charts for Indian, Australian, Frankfurt, Euronext, UK, Ireland and Canadian stocks, tabbed stock quote watchlists, multi-currency portfolio manager, active stock screener with fundamental trading strategy support and trading system builder. Forex, precious metal and energy commodities too. Build your own trading system and sell your trading strategy in our MarketPlace to earn real cash.

You can read what others are saying about Zignals on Investimonials.com.

JOIN US TODAY - IT'S FREE!

Popular posts from this blog

S&P "Bull Trap"?

Image
I thought there was sufficient evidence to argue against a "bull trap" in the S&P, but it would appear the market wasn't interested in such thoughts and sellers were quick to reverse the initial push above 4,200.  Adding to the pain were new 'sell' triggers in MACD and On-Balance-Volume, although the former occurred above the 'bullish' zero line, making it a weak signal. Selling volume ranked as distribution as selling momentum picked up speed.  The index is also underperforming relative to the Russell 2000. 
Read more

"Black Candlesticks" are a concern for the S&P and Nasdaq

Image
A bright start for bulls on the back of positive $NVDA earnings wasn't enough to generate a day of meaningful gains.  However, it did help stall the losses of the last couple of days. The Nasdaq was the biggest beneficiary of today's action, but not enough to see an end-of-day finish that cleared last week's swing high, nor delivery of a large white candlestick, despite the morning breakout gap.  Technicals are net bullish and relative performance against the S&P has become consistently stronger since the start of May.  While today's candlestick I would view as typically 'bearish', today's volume ranked as confirmed accumulation (bullish). Overall, I would be looking for higher prices from here. 
Read more

Round 2 for the bearish "black" candlestick in S&P and Nasdaq

Image
The Nasdaq started brightly but ended up closing below its open price, but above yesterday's close. The S&P did something similar, although the intraday range is narrower. These two setups are somewhat complicated by the new 'buy' triggers in On-Balance-Volume for both the Nasdaq and S&P. And the new MACD trigger 'buy' for the S&P. Price action is key, so I would expect the candlestick to trump the technical picture; watch for lower prices tomorrow.
Read more

Archive

Show more