Tuesday, July 07, 2015

S&P To Break 2085?

A huge bullish reversal after an opening sell off leaves things nicely set for bulls tomorrow. The media attributed a recovery in oil prices to market gains (a rare attribution for oil prices!), but whatever the cause it was a big intraday swing.

The S&P spiked through 200-day MA support on heavy volume accumulation. Other technicals are net bearish, although the index is enjoying a relative performance against Small Caps.


The Nasdaq also spiked low, but not at major support. Although it wouldn't be hard to pick a swing low from previous scrappy trading to mark a support level.


The Russell 2000 also finished with a spike low. However, it did so inside a trading range - enough to readjust support to mark a possible bullish ascending triangle. Technicals are negative, and the index is underperformig relative to its peers.


If there is a disappointment to today it's that rallies jumped before markets had a chance to really become oversold. However, such wide range action is common at key lows and is common with capitulation, so it needs to be respected. Tomorrow is a chance to push on, but will Greece/China allow it.

You've now read my opinion, next read Douglas' and Jani's.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com, and Product Development Manager for ActivateClients.com. I do a weekly broadcast on Friday's at 13:30 GMT for Tradercast, covering indices, FX and gold, silver and oil - all are welcome! You can read what others are saying about Zignals on Investimonials.com.

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