Friday, March 21, 2014

Daily Market Commentary: Modest Bullish Action

The back-and-forth between bulls and bears continued, this time with bulls controlling the day. Action tightened as the spread between the day's high/low narrowed, although the S&P still managed to experience a relatively wide trade day.

Action in the Nasdaq is narrowing to a coil. It could spring either side: a short break should bring a test of 4,245; an upside break will bring 4,371 into play. Either way, a stop can be placed on a flip-side and play it from there.


The S&P was a little more bullish. It finished with a rejection of the lows and a close near the prior day's high. Volume climbed to register an accumulation day.  It's perhaps best set for more upside, with futures suggesting a gap higher on the open.


The Russell 2000 is caught somewhat in the middle: starting in a position comparable to the S&P, but experiencing a day like the Nasdaq. It didn't finish as bullish as the S&P, but did at least hold on to 20-day MA support.


With futures suggesting a bright open for bulls it's possible we will see recent swing highs challenged today. The Nasdaq has the most bullish long term picture, but the S&P might offer the better opportunity for the near term trader.

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