Daily Market Commentary: Mixed Day

An odd day for the markets with a mix of gains (Russell 2000) and losses (anything else!). Volume climbed to register distribution for the Nasdaq, Nasdaq 100 and S&P, but given the degree of loss it's more like churning than hard defined selling.

The S&P sharply reversed its relative gain against the Russell 2000, but is close to a MACD trigger 'sell'.



The loss in the S&P was offset with a gain in the Russell 2000, although this index had the greatest loss yesterday.  The gain in the Russell 2000 wasn't enough to reverse the 'sell' in the MACD.


The Nasdaq finished effectively flat, but trading volume was particularly heavy. This volume spike contributed to an increased loss in On-Balance-Volume, which builds on the MACD 'sell' trigger.


The net effect of today was better for bulls.  Despite heavier volume, the selling was unable to push the market significantly lower. Also, the more speculative Small Cap stocks managed gains and swung the market away from defensive Large Caps. The market needs a substantial pullback to balance the gains, but it may still be a little early for it (despite the heavily overbought nature of the market)

---

Follow Me on Twitter

Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. You can read what others are saying about Zignals on Investimonials.com.

JOIN ZIGNALS TODAY - IT'S FREE!

Popular posts from this blog

S&P "Bull Trap"?

Image
I thought there was sufficient evidence to argue against a "bull trap" in the S&P, but it would appear the market wasn't interested in such thoughts and sellers were quick to reverse the initial push above 4,200.  Adding to the pain were new 'sell' triggers in MACD and On-Balance-Volume, although the former occurred above the 'bullish' zero line, making it a weak signal. Selling volume ranked as distribution as selling momentum picked up speed.  The index is also underperforming relative to the Russell 2000. 
Read more

"Black Candlesticks" are a concern for the S&P and Nasdaq

Image
A bright start for bulls on the back of positive $NVDA earnings wasn't enough to generate a day of meaningful gains.  However, it did help stall the losses of the last couple of days. The Nasdaq was the biggest beneficiary of today's action, but not enough to see an end-of-day finish that cleared last week's swing high, nor delivery of a large white candlestick, despite the morning breakout gap.  Technicals are net bullish and relative performance against the S&P has become consistently stronger since the start of May.  While today's candlestick I would view as typically 'bearish', today's volume ranked as confirmed accumulation (bullish). Overall, I would be looking for higher prices from here. 
Read more

Round 2 for the bearish "black" candlestick in S&P and Nasdaq

Image
The Nasdaq started brightly but ended up closing below its open price, but above yesterday's close. The S&P did something similar, although the intraday range is narrower. These two setups are somewhat complicated by the new 'buy' triggers in On-Balance-Volume for both the Nasdaq and S&P. And the new MACD trigger 'buy' for the S&P. Price action is key, so I would expect the candlestick to trump the technical picture; watch for lower prices tomorrow.
Read more

Archive

Show more