Daily Market Commentary: S&P Resistance at 50-day MA
It was going to happen at some point, but sellers made an appearance after a strong upward swing from the November swing low. Resistance played out at the 50-day MA, but selling volume was below average, and below Friday's higher volume accumulation. Technicals also turned net bullish by the close of business.
It was a similar story for the Nasdaq. Technicals also turned net bullish.
Helping out the Nasdaq was the net bullish turn in the Percentage of Nasdaq Stocks trading above the 50-day MA. This breadth index is usually the first to turn bullish, but the rally for November is substantial, increasing the probability for a decent Santa Rally.
The Russell 2000 also experienced net bullish technicals. Like the S&P and Nasdaq, it encountered resistance at its 50-day MA; but this resistance also corresponded to horizontal resistance. As a result, there may be more selling pressure for this index than for the aforementioned indices.
I'm still liking a Santa Rally off the November low. Today's losses at 50-day MAs suggest the start of a buying pullback, but it might come down to Fibonacci retracements for the optimum time to buy (Fib retracements set at the range of November swing lows and today's high).
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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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It was a similar story for the Nasdaq. Technicals also turned net bullish.
Helping out the Nasdaq was the net bullish turn in the Percentage of Nasdaq Stocks trading above the 50-day MA. This breadth index is usually the first to turn bullish, but the rally for November is substantial, increasing the probability for a decent Santa Rally.
The Russell 2000 also experienced net bullish technicals. Like the S&P and Nasdaq, it encountered resistance at its 50-day MA; but this resistance also corresponded to horizontal resistance. As a result, there may be more selling pressure for this index than for the aforementioned indices.
I'm still liking a Santa Rally off the November low. Today's losses at 50-day MAs suggest the start of a buying pullback, but it might come down to Fibonacci retracements for the optimum time to buy (Fib retracements set at the range of November swing lows and today's high).
---
Follow Me on Twitter
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.
Zignals offers a full suite of FREE financial services including price and fundamental stock alerts, stock charts for Indian, Australian, Frankfurt, Euronext, UK, Ireland and Canadian stocks, tabbed stock quote watchlists, multi-currency portfolio manager, active stock screener with fundamental trading strategy support and trading system builder. Forex, precious metal and energy commodities too. Build your own strategy and sell it in the MarketPlace to earn real cash.
You can read what others are saying about Zignals on Investimonials.com.
JOIN ZIGNALS TODAY - IT'S FREE!
