Thursday, February 16, 2012

Daily Market Commentary: Bulls Make Presence Felt

After yesterday's sell off it was looking easier for bears to push their advantage than for bulls to recover. But in the end, it was bulls which came out tops.

Semiconductors had the best of the day's trading. The rally has resulted in a new realignment for the bullish trend and reversed a bearish turn in the CCI.  However, the MACD 'sell' trigger remains.


Small Caps also performed well, reversing the breakdown and creating a potential 'bear trap' of shorts. Another 4 points worth of gains will see a new high for the index.


Tech indices benefited from the buying in the semiconductor index, preventing what was looking like a channel breakdown.  The MACD trigger 'sell' was also negated.


But the S&P wasn't quite so lucky, although the level of buying was lighter than in the Nasdaq or Russell 2000.


It's getting harder for indices to attract new investors. Today's buying was on the back of lighter volume, a sign of tiredness in the market. However, 2012 rallies are still intact so - it's not a sell either. As long as rising channels are honored the 'hold' of existing positions is favored. Shorts from the break of the Russell 2000 will have probably covered, but today's buying will have hurt those positions and more may cover tomorrow.

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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 Trading Strategy Marketplace Leaderboard. The Leaderboard also supports advanced search capability so you can tailor your strategies to suit your individual requirements.

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