Saturday, October 03, 2009

Stock Market Weekly Commentary: Seller's Heaven

Resistance was confirmed in many of the indices, but volume was considerably lighter and although the week closed lower it did not register as a distribution week.

The S&P remained pegged by 1,062 resistance as the bearish divergence in the MACD histogram continued to evolve

The Nasdaq's losses weren't enough to reverse its breakout - although technicals suggest there is more downside to come.

The Nasdaq 100 bucked the trend a little by registering a distribution day and falling below what were two resistance levels turned support.

Small caps played resistance picture perfect but have yet to confirm a 'sell' signal

Market Breadth has already fallen sharply - particularly in the percentage of stocks above the 50-day MAs

Although some remain stubborn - but seriously overbought

Look for this weakness to continue to develop with a sideways market perhaps the best outlook for bulls, but a more substantial down phase favoured.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.