Daily Market Commentary: Bulls Stage a Recovery

After a post-holiday hangover markets got off to a sluggish start, but by the close of business bulls had done enough to suggest there might be some upside follow through tomorrow.

The S&P was able to dig-in at its 50-day MA, but finished the day caught between its 20-day and 50-day MAs.

AAAAAAAAAB S&P 500 Large Cap Index ($SPX)

via StockCharts.com

The Nasdaq eased back into last Thursday's gap before recovering. Volume also picked up into the close, although it did not get to test its 50-day MA.


via StockCharts.com

However, the semiconductor index held on to its breakout and if it can continue to do so over the next couple of days it will help push the Nasdaq and Nasdaq 100 past their November highs.


via StockCharts.com

The Russell 2000 held on to its 20-day MA; 736 resistance is still a big test - a challenge for Tuesday.


via StockCharts.com

Today's late afternoon action suggests markets will follow through higher tomorrow. However, if markets were to gap down off the open I would then look for a powerful move down as it would undermine the raison d'etre for today's buying and drive a rush to the exits.

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