Sunday, September 13, 2015

Friday's Narrow Range - Monday Decision Day?

A late flourish on Friday has opened up the chance for a big short covering rally. Shorts will need a loss of  Friday's lows to bring a break of rising support. Longs probably have the easier path, but it could be a volatile session.

The S&P has coiled nicely, but trading volume was light on Friday. Play for break of support or resistance.


The Nasdaq is knocking on the door of trading range resistance. A move above 4,850 opens up for a challenge of 5,038. Technicals are in recovery mode, although the MACD trigger 'buy' is a long way from the bullish zero line, and the momentum 'buy' trigger is knocking near resistance. However, the Nasdaq is enjoying a relative advance against both the S&P and Russell 2000.


The Russell 2000 finished at the 20-day MA. The next move higher is to the 50-day MA. Bears will look to a potential 'bear flag' even if there is a rally on Monday. A push below Friday's open would set up a rising support break.


Look to pre-market action for market leads. While a retest of August lows would offer a chance to firm up lows, a rally would return Tech indices back inside the tight trading range which indices have experienced for most of 2015.

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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