Thursday, August 08, 2013

Daily Market Commentary: 20-day MAs Hold

Yesterday saw 20-day MA of the S&P challenged for the first time since June. Today registered as a defense of this moving average. However, the Dow Jones Industrial Average wasn't so lucky:


The S&P also enjoyed a relative strength shift against the Russell 2000. This will be bullish for the S&P, although bearish for the larger rally as money shifts from speculative small caps to more defensive large caps.


While the Nasdaq and Nasdaq 100 hasn't yet challenged 20-day MAs, the Semiconductor index is attempting a defense of its 50-day MA. This is the first index to do so and will guide expectations for Tech indices.


The Nasdaq 100 is the only index not to 'bull trap'. The 20-day MA has converged with the upper channel line which should help it tomorrow.  Bulls will have another chance to defend, but if the semiconductor index gives up its 50-day MA it may be tough for the Nasdaq and Nasdaq 100 to continue their rallies.


Buyers can again look to 20-day MAs for buying opportunities, but if it looks like Friday's close will see a close below this average, then it will look more probable next week will start with a bearish tone.


All Contributions Welcome - Thank You!

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!
 
f9229fcfd1b1390be00cfccc86c90349c93a4179bf4227457c