Thursday, March 22, 2012

Daily Market Commentary: Heavier Losses But Volume Light

The extent of today's losses increased over yesterday's, but it wasn't accompanied with any great volume. Support at 20-day MAs is still available for most indices and while available it offers the first of many points of attack for bulls.

The Russell 2000 was the most vulnerable index heading into today and the groundwork for a potential 'Bull Trap' is now in place.  The gap down puts a bit of space against the ex-breakout which will likely be filled in early Friday trading; the question is whether it can make it above 833?


The semiconductor index is sticking close enough to 440 resistance to still offer a good opportunity for bulls.  It may take another pass of the fast rising 50-day MA to stimulate demand to drive the breakout.


Of the lead indices, the Dow is the one come under a bit more selling pressure than the others.  It's hanging close to 13,000 support but with 'sell' triggers in the MACD, Directional Index and On-Balance-Volume.


What will tomorrow bring? Further weakness will likely hurt the Russell 2000 more than other indices. If markets start brightly it will be important to look at semiconductors; a 2% gain will be enough to generate a breakout.

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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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