Daily Market Commentary: No Rest For Bulls

It was more of the same for the semiconductor index. Yesterday's breakout was followed by some decent action, further improving the technical picture for this index and offering a strong foundation for additional gains in the Nasdaq and Nasdaq 100.

The Russell 2000 also had a strong day, finally breaking upside from its narrow base. The index is trading well inside its bullish channel, which offers a good basis for further gains in the weeks ahead.

The Nasdaq is building off its recent 'bear trap', supported by the gains in the semiconductor index. These too are operating inside the rising channel with plenty of room to run before resistance becomes a concern. Risk is based on a loss of the 'bear trap' low.

Large Caps had a more modest day, pushing to a new high, but not really pulling away from support. Technicals are more mixed, although another couple of upside gains would return all technicals net bullish.

I thought today would have been quiet given Tuesday's recovery, so it was interesting to see new indices make new highs just a day later. A similar sell off in November was followed by a rally which lasted 2 weeks - bulls look ready to repeat this trick.


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Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com.
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