Monday, October 08, 2012

Daily Market Commentary: Breaks in Tech and Small Caps

Columbus Day was a quiet day for the markets.  Trading volume was light. This lessened the impact of the observed breakdowns in technology indices.

The gap down for the Nasdaq finished just above rising channel support.  Despite the light volume there was a bearish 'sell' trigger for on-balance-volume.


It was the same for the Nasdaq 100, although the index finished close to horizontal support at 2,795.


The Russell 2000 also broke from its bearish flag.  Interestingly, there was a relative swing in favour of Small Caps over Technolgy, despite the 'bear flag' breakdowns in each of the indices.


Only Large Caps escaped the worst of the sell off as the index remained in the upper zone of their 'bear flags'.


Will the return of traders from the bank holiday weekend see an expansion of the sell offs for the Nasdaq and Russell 2000?

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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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