Daily Market Commentary: Selling Pressure

My weekly summary is of greater relevance after today's action.  Markets' just can't make their mind up - up one day, down the next. Today was the return of sellers on relatively light volume.  Large Caps carried the brunt of the selling, Tech indices were relatively resilient, while the Russell 2000 undercut its 20-day MA.

The Dow is on its way to channel support, and will likely see this tested tomorrow. It may be enough for an aggressive long side trade, although the chance for a follow through to the 200-day MA is quite high.

The Russell 2000 is hanging on to its breakout, although it closed below its 20-day MA.  However, the bullish picture remains the more dominant and until proven otherwise, buyers have the edge.

The Nasdaq also had a low key day. The index is holding above its 20-day MA despite the loss.  The earlier breakout has turned into a 'bull trap', but this could be easily negated with one strong day. There is a MACD and On-Balance-Volume 'sell' trigger to navigate too.

Despite the obvious selling, there is still enough on offer for bulls to be sniffing for buys in the morning. The 'bull traps' are a concern and one wouldn't want these to get away with more selling, but bulls probably have enough in the tank to send shorts running.


All Contributions Welcome - Thank You!
Follow Me on Twitter

Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
You can read what others are saying about Zignals on Investimonials.com.


Popular posts from this blog

Markets attempt a swing low for the seven day decline

Low volume selling after Russell 2000 breakout

Minor losses pressure Thursday's reversal attempt


Show more