Wednesday, September 05, 2012

Daily Market Commentary: Inside Day

It was a day which had more in common with last week's vacation trading than the start of a new trading week. Indices were little changed on the day, trading in a narrow range on slightly heavier volume.

The chief concern was the semiconductor index. It dropped further away from a down-turning 20-day MA, finishing on 390 support. Bulls won't want it to lose much more with the 50-day MA at 383, the last line of defense for bulls.


The worry for the Nasdaq and Nasdaq 100 is while they are holding 20-day MA support, the influencing semiconductor index is pulling further away from its own. Both tech averages are operating on a 'sell' trigger in their MACDs, but other technicals are holding the bullish line.


Those looking for a long trade can focus on the Dow which is holding rising trendline support having bounced off its 50-day MA.


Markets are still vulnerable, although I have taken a long position in the XLU from today's open.  I suspect there is still enough juice in the tank to see another leg higher.

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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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