Tuesday, July 06, 2010

Daily Market Commentary: Indecision Once Again

From June struggles at 50-day or 200-day MAs to July struggles at former trading range support-turned-resistance it was a disappointing day for bulls. Even within this, some indices did worse than others.

The S&P spun around Friday's range with early gains towards 1,049 resistance (1,040 for many others) pegged back by the close. Volume made modest post-vacation gains but was well down on a normal trading day. Technical weakness expanded and it has started to significantly outperform Small Cap stocks (bearish).


via StockCharts.com

The Nasdaq was similarly struggling although there is a declining support which is holding and offers potential for those who like to catch knives - run a tight stop (below 2,061) if looking to go long.


via StockCharts.com

The real damage was in the Russell 2000. A close at the lows leaves it looking like an index which wants to crash. It is deeply oversold - but oversold can stay oversold. Buyer Beware.


via StockCharts.com

The one index to offer hope is the semiconductor index. Unlike the others it has yet to breach the trading range, although technically it is struggling.


via StockCharts.com

Wednesday will be a day to watch the Russell 2000 and SOX; the former for a runaway move down or the latter to form a bottom. Which will come up trumps?

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