Tuesday, June 04, 2013

Daily Market Commentary: Losses offset Yesterday's Gains

Yesterday's bounce didn't last long as indices struggled to defend 20-day MAs. Only the semiconductor index is showing some backbone in this regard, although it's working off a MACD trigger 'sell'.

The Nasdaq lost ground against its 20-day MA after rallying to close above this MA yesterday.  Luckily, the index has a former resistance line, turned support, to help.  However, should this be lost it will be looking at the 50-day MA for support.

The Russell 2000 is hanging on to a trendline support, and is close enough to its 20-day MA to suggest it could play as support tomorrow.

Nasdaq Breadth continues to roll over in line with a swing high. It will take more downside until a decent swing low presents itself.

Tomorrow will again put the focus on 20-day MAs. Better for the long term health of the rally will be for a move down to 50-day MAs. With the possible exception of Utilities, sectorbreadth remains too bullish for a swing low. .


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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.