Daily Market Commentary: Tech and Small Caps' New Highs

Bulls will probably be a little disappointed the trading week is cut short by Thanksgiving, as the Nasdaq, Nasdaq 100 and Russell 2000 all posted strong gains on decent volume.

The semiconductor index also got into the action with what's shaping up to be a 'bear trap' and potential breakout. Only a MACD trigger 'buy' awaits for a net bullish turn in technicals.


The Nasdaq 100 finally took out its 'bull trap' and is about to generate a new MACD trigger 'buy'.  This will turn all technicals net bullish.


The Nasdaq was able to take this a step further with a breakout, 'bull trap' negation, and a fresh MACD trigger 'buy'. The rally is contained within its rising channel and it will meet resistance if tomorrow offers another gain. Better still, there is a relative strength against the S&P: this marks a rotation out of defensive Large Caps into more speculative Technology stocks.


Leading against the Nasdaq is the Russell 2000. Small Caps had the best of today's action, and are best placed to advance: new highs.  In addition, channel resistance is well away.


Buyers have another of options to follow: a pending breakout in the Semiconductor index, improving Tech averages, or market leading Small Caps. Whatever was on offer for shorts last week has disappeared over the last couple of days.

---

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.

JOIN ZIGNALS TODAY - IT'S FREE!

Popular posts from this blog

S&P "Bull Trap"?

Image
I thought there was sufficient evidence to argue against a "bull trap" in the S&P, but it would appear the market wasn't interested in such thoughts and sellers were quick to reverse the initial push above 4,200.  Adding to the pain were new 'sell' triggers in MACD and On-Balance-Volume, although the former occurred above the 'bullish' zero line, making it a weak signal. Selling volume ranked as distribution as selling momentum picked up speed.  The index is also underperforming relative to the Russell 2000. 
Read more

"Black Candlesticks" are a concern for the S&P and Nasdaq

Image
A bright start for bulls on the back of positive $NVDA earnings wasn't enough to generate a day of meaningful gains.  However, it did help stall the losses of the last couple of days. The Nasdaq was the biggest beneficiary of today's action, but not enough to see an end-of-day finish that cleared last week's swing high, nor delivery of a large white candlestick, despite the morning breakout gap.  Technicals are net bullish and relative performance against the S&P has become consistently stronger since the start of May.  While today's candlestick I would view as typically 'bearish', today's volume ranked as confirmed accumulation (bullish). Overall, I would be looking for higher prices from here. 
Read more

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

Archive

Show more