Thursday, May 04, 2017

Technicals Net Bullish Across Indices

All lead indices are net bullish in technical strength as markets consolidated last week's gains.  The S&P has posted a series of doji/hammer after emerging from a bullish 'flag' / downward channel.


The Nasdaq gapped down Wednesday but held its ground in another narrow day of trading. Relative performance ticked down after significant outperformance against the S&P, but it still remains ahead of Large Cap stocks.


The Russell 2000 was on course to register the third day of losses in a row, but it did enough to come back to newly minted breakout support around 1,390. Technicals are still bullish, although +DI/-DI is about to generate a negative/bearish crossover.


The Semiconductor Index is coming back off a retest of highs in what may become a double top, although a loss of 960 would be required to confirm. In the meantime, the index sits on what was former channel support with technicals easing lower - although such technicals look ready to accelerate down which may be the lead action for a loss of 960.


For Friday, shorts may have something to play for in the Semiconductor Index with a stop above 1,025.  The Russell 2000 might go the other way; downside action looks to be tiring and the presence of support may be the kicker to start a new rally. Watch these indices closely over the next couple of days.

You've now read my opinion, next read Douglas' blog.

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Dr. Declan Fallon is a blogger who trades for fun on eToro and can be copied for free.
. I invest in my pension fund as a buy-and-hold.
 
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