Daily Market Commentary: Tetchy Friday

Ukrainian fears (mis-information) knocked Friday's morning rally before markets staged a recovery by the close. Sellers are likely to remain trigger happy but bulls have been willing to snap up these sell offs. Volume climbed to register distribution in non-Tech indices, but the August bounce from swing lows remain intact.

The S&P closed between the 20-day and 50-day MAs, but with a bullish cross in stochastics and a new MACD trigger 'buy'.

The Nasdaq came close to tagging 4,485, but unlike Large and Small Cap indices it finished higher. Watch for a potential breakout on Monday. Technicals are again all net bullish

The Nasdaq 100 is closer to making that new high. Like the Nasdaq, all technicals are all net bullish.

Those waiting for value opportunity in the Nasdaq will want to see another leg lower in market breadth to oversold (green highlight) areas.

On the flip side, the Russell 2000 closed with a bearish engulfing pattern off its 200-day MA. Will it now attempt the backtest? The channel breakout is confirmed, but it's now having to work through supply at the moving averages.  Once these are cleared, a challenge of 1,210 is next.

Shorts may get some joy from the Dow Jones Industrial Average. It reversed off resistance, but the 'bear trap' is still in play. Stops on a close above 16,775 (with a target of the 200-day MA).

For Monday, look for weakness in Large Caps, but breakout opportunities in Tech.


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