Daily Market Commentary: Markets Finely Poised

There wasn't a whole lot going on in lead indices. The S&P finished with a low volume doji which could offer a swing trade opportunity on break of high/low (stop on the flip side). Technicals are bullish and rising, so the expectation is for a break to the upside. But a double top can't be ruled out either - for this to confirm it will require a (swift) move back and below 1,260.

($SPX)

via StockCharts.com

The Nasdaq finds itself with another indecisive doji (next to Friday's shooting star) bang on gap resistance. The February gap down dominates and if it's a true breakdown then it's a gap which cannot be filled. Should the gap fill then 2,840 won't be long for resistance. Aggressive bulls can buy break of 2,800, while shorts will be looking to cover around 2,832.

($COMPQ)

via StockCharts.com

Helping bulls is a confirmed net bullish stance in Nasdaq Bullish Percents and Summation Index

($BPCOMPQ)

via StockCharts.com
($NASI)

via StockCharts.com

Semiconductors suffered a third day of losses having been pegged by declining resistance. But the afterhours buyout of National Semiconductor by Texas Instruments will generate plenty of interest in this sector tomorrow. But bulls have their work cutout. The first challenge is to crack above declining resistance and nearby 50-day MA. Then it can go on to challenge the 2011 high. Strength in semiconductors will also help the Nasdaq and Nasdaq 100.

($SOX)

via StockCharts.com

While the Russell 2000 broke the bearish divergence in its MACD.

($RUT)

via StockCharts.com

Tomorrow will be very interesting. I suspect bulls will be the happier, but bears are not without opportunity from breakdown gaps and/or double tops. On a positive front, tight stops can be played on both sides of the fence.

Follow Me on Twitter

Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. I offer a range of stock trading strategies for global markets which can be Previewed for Free with delayed trade signals. You can also view the top-10 best trading strategies for the US, UK, Europe and Rest-of-the-World in the Zignals Trading Strategy Leaderboard. The Leaderboard also supports advanced search capability so you can tailor your strategies to suit your individual requirements.

Zignals offers a full suite of FREE financial services including price and fundamental stock alerts, stock charts for Indian, Australian, Frankfurt, Euronext, UK, Ireland and Canadian stocks, tabbed stock quote 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.

You can read what others are saying about Zignals on Investimonials.com.

JOIN US TODAY - IT'S FREE!

Popular posts from this blog

Round 2 for the bearish "black" candlestick in S&P and Nasdaq

Image
The Nasdaq started brightly but ended up closing below its open price, but above yesterday's close. The S&P did something similar, although the intraday range is narrower. These two setups are somewhat complicated by the new 'buy' triggers in On-Balance-Volume for both the Nasdaq and S&P. And the new MACD trigger 'buy' for the S&P. Price action is key, so I would expect the candlestick to trump the technical picture; watch for lower prices tomorrow.
Read more

Being "Right" but still losing...

Image
I'm trying the Topstep Trader Combine as a sampler to day trading and it's an interesting setup with minimal outlay costs to get started. I'm not a huge fan of their platform UI but everything else has been pretty good so far. Today was one of those days where I waiting (and waiting) for the profit taking to kick in, but by the time sellers made their appearance I had reached my loss limit for the day and so that, was that. You can see all of my whipsaw trades here. For the record, I only work off price action, looking at support/resistance and tells like rapid stop take outs, usually a good sign for a reversal.
Read more

Big bearish engulfing patterns as positive start negated

Image
It was a setting up to be a low key day, but come the afternoon, sellers pounced and drove markets down hard after doubts raised on future rate cuts. Fed news wasn't the key takeaway, but the loss of support was. The S&P was hardest hit, not because of the percentage loss, but because of the volatility relative to recent trading action. Today marked a clear breakdown of trendline support. It should be noted, the presence of the 50-day MA offers a point of defence but today's loss does not mean we will see a crash; a time-led consolidation seems more likely. Technically, the MACD accelerated its losses and there was a fresh 'sell' in On-Balance-Volume.
Read more

Archive

Show more