Wednesday, August 28, 2013

Daily Market Commentary: Weak Recovery

I was hoping for a little more but it was a lackluster (and low volume) recovery for the various indices. The Dow Jones was best positioned to benefit, but even it struggled to hold intraday gains.


The S&P is caught in a no-mans land between 50-day and 200-day MAs.  Today's gain changed little and keeps the larger measured move target lower in play.


The Nasdaq's bullish defense did not involve the 50-day MA below. A 50-day MA test is still likely and probably needed to offer a tradable swing low.


The Russell 2000 likewise experienced a very narrow range day despite yesterday's big losses.  And like the Nasdaq its gains occurred away from a logical support level; a move to 1,000 would offer a good upside buying opportunity should it occur over the next few days.


Still looks to be a bears game, but bulls can continue to fish the Dow for a low risk upside opportunity (with a stop on a loss of channel support).

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
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