From: Fallondpicks.com
Ben Bernanke swung his axe and the markets tumbled. Late afternoon trading was unable to hold early gains; especially in the NASDAQ and S&P. But some markets never got off the ground. The Dow was the big loser in this regard, but the semiconductor index was another index to suffer. The Russell2000 clung to its leadership role. The bearish divergence in the MACD was breached in the latter index, but a similar divergence in the CCI of this index remained. Of the secondary tech indicators [$NASI, $NAA50 and $BPCOMPQ]; the $NAA50 switched back in favor of the bears, weakening the chance of a short term tech bounce. Also of concern was the ticking time bomb that is volatility. The index has likely found stronger support at 15, than it has resistance at 18 - this could see a sharp dose of fear over the coming weeks, which will pile on the misery for those who have bought into the market over the last couple of months.
The NASDAQ maintained channel resistance (drawn from January), reversing on higher volume, marking a technical distribution day. A move to support from November, and if volatility spikes, to the lower channel line (and/or the 200-day MA), looks favored as the index steps away from a channel breakout. Bulls will cling to the possibility of support at the 20-day/50-day MAs, but the index is running out of room to do this. The Dow was creamed as the index pushed through former broadening wedge resistance, down to the 20-day MA and February reaction highs. Bulls will need to step up to the plate tomorrow if this market is not to get swallowed in a wave of selling. Support at the 50-day MA as it converges with October would appear to be the best place to watch for a bounce. Volume selling did increase, but remained below average for the Dow. The semiconductor index looks destined to test the 200-day MA as the 20-day MA acts like a blanket of resistance. Technicals remain weak, most notably the -DI line above the +DI line. The S&P finished the day at 1,294 support (and the 20-day MA), but its MACD triggered a "sell" signal and this looks primed for further losses, with October support again on the menu.
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OPLK was a Breakout feature for March 23rd. The stop was hit for an 11% loss, but it did manage to stall at the 50-day MA. BFT hit its raised stop, but remains bullish over the near term. The stop was a cautionary measure to protect profits in a weak market. The breakout gap support at $8.00 should be viewed as a last line of defence if you are looking to give the trade a little more room. The January 26th Breakout play closed for a 13% gain and the December 29th Subscriber play closed for a 47% gain. The March 27th Subscriber play closed for a 3% loss. RAIL hit its raised stop after a downgrade by CIBC. The February 14th Breakout play closed for a 7% gain. The January 12th Subscriber play closed for a 29% gain, and the March 27th play closed for a 7% loss. The main concern in this stock is for a double top.
Fallond
