Monday, April 05, 2010

Stock Market Commentary: Positive Jobs Positive Response

The reaction to good news was swift but volume was very disappointing given the significance of the price gains. The action had the characteristics of short covering but while volume was on the downside there were some important technical changes.

For the S&P the MACD trigger 'sell' was negated as on-balance-volume nicked a new reaction high. Relative strength swung back towards Small Caps - a bullish development. The support channel line held firm and the bearish implications of the spinning top was negated.

The gains in the Nasdaq did not change the bearish technical picture and the shooting star is still in play

The best returns came from Small Caps with a fresh breakout (691 new support). The 'sell' trigger in the CCI reversed but not the one for the MACD. Watch for a false breakout.

The other strong performer was the semiconductor index. Both MACD and CCI 'sell' triggers were negated.

Without buying volume Monday's gains carry a level of skepticism. However, recent congestion has been cleared and there is room to the upside as per my weekly commentary.

Follow Me on Twitter

Build a Trading Strategy in Zignals; Read how and earn real money (once out of Beta) in this PDF.

Dr. Declan Fallon, Senior Market Technician for, offers a range of stock trading strategies for global markets under the user id: ‘Fallond’, ‘ETFTrader’ and ‘Z_Strategy’ available through the latest rich internet application for finance, the Zignals Dashboard or the Zignals Trading Strategy MarketPlace.

Zignals offers a full suite of financial services including price and fundamental stock alerts, stock charts for Indian, Australian, Frankfurt, Euronext, UK, Ireland and Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active stock screener with fundamental trading strategy support and trading system builder. Forex, precious metal and energy commodities too. Build your own trading system and sell your trading strategy in our MarketPlace to earn real cash. Read what others are saying about Zignals on