Thursday, April 19, 2012

Daily Market Commentary: Stealth Distribution

At first glance, the damage done by today's selling seemed light. But once volume was considered it carried a little more menace.  European troubles and weak economic data was given as today's excuse, but profit taking was a more likely factor in the selling.

The S&P is dicing with its 50-day MA, finishing just below support. Shorts may find more on offer with 1,392 playing as resistance.


The Nasdaq was rebuffed by its 20-day MA after a stronger start, but it too finished the day just below 50-day MA support. However, trading action is more sideways than short favored.


While the Russell 2000 was surprisingly resilient given its weakness.  The 'Death Cross' between 20-day and 50-day MAs will offer shorts a stop point for positions. 

 

Look for shorts to add to the selling pressure with 200-day MAs the target.

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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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