Tuesday, July 03, 2012

Daily Market Commentary: Consolidation

Given the July 4th holiday sits bang in the middle of this week and traders are likely to extend the holiday into the weekend it would appear unlikely for any big move to emerge this week (assuming Europe doesn't throw a wobbler).

Yesterday played to this form: A modest gain on light volume, but more importantly holds Friday's gains. The S&P shows a net bullish picture.


Along with the Nasdaq; yesterday's small gain was actually the breakout


Although the semiconductor index will need some of this mojo to regain the 200-day MA. It's struggling a little, but has done well to negate what looked a certain 'bull trap'.  Technicals continue to improve and are net bullish.


The best news was saved for the Russell 2000. This key 'bull market' index enjoyed a solid 1%+ gain and has been the leading index in the late June push; note the sharp rise in relative strength to the Nasdaq.  This is good news for those looking for this rally to continue as the Nasdaq and S&P should follow suit.


Today may be little different, for those looking to travel for the next few days it may be a case of selling (not wanting to hold for the uber-long weekend), so perhaps today will be a day for some modest downside.

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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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