The Semiconductor Index was another to make a move higher. It cleared declining resistance and the 50-day MA. Better still, it was the first key index to return net bullish in technicals.
This will help the Nasdaq 100 which is just shy of a test of declining resistance. It too enjoyed a day of bullish accumulation. Technicals are not as bullish, but they are improving.
The Russell 2000 had the most ground to make up as it's the index which has consistently under-performed since July. While other indices have done well, a true bullish recovery will need leadership from this index, which hasn't come yet.
The S&P broke from declining resistance, but not the key resistance level challenged and broken in the Dow.
Today knocked out a short position I took at resistance in the Dow. Intraday analysis shows an extended sequence of green candles, which suggests short covering, but it was enough to knock me out. Watch for a 'bull trap' in the Dow, although buyers will be finding confidence on what is increasingly looking like a double bottom.
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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