Daily Market Commentary: Moving Averages Break

A further acceleration in the rally took indices past key moving averages and into a space with limited overhead resistance. One of the indices hardest hit by the sell off was the semiconductor index. While it hasn't challenged July highs it did close above the neckline and 50-day MA. Technicals also finished today net bullish.


Gains in the semiconductor index will help push the Nasdaq and Nasdaq 100 to new 52-week highs. Measured moves project the April-July rally on to August swing lows: for the Nasdaq, this sets a target around 4,870 and the Nasdaq 100 it's 4,425.



The Russell 2000 also managed a close above its 50-day MA. It's now in a void of resistance until it gets to 1,210. Technicals are improving, but haven't yet reversed all bearish markers.


The S&P will soon be like the Nasdaq. It hasn't yet made a new all time high, but one more days worth of gains will do it.


As for tomorrow, bulls have control. Pullbacks will offer buying opportunities as the swing low develops as support.  Tech averages are best positioned for gains, but the Russell 2000 has plenty of room to run before encountering resistance.

---

Accepting KIVA gift certificates to help support the work on this blog. All certificates gifted are converted into loans for those who need the help more.

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