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Showing posts from November, 2014

Happy Thanksgiving!

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It's unlikely we will be seeing much action over the next few days. I have memories of Thanksgiving Friday been good for bulls, but with holiday trading anything can happen. The index most likely to enjoy a good holiday break is the Russell 2000.

Semiconductors Continue to Gain

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Again, it was left to Semiconductors to do the leg work for the day as it added nearly 1%. The question is whether strength in this index will contribute to further gains for the Nasdaq and Nasdaq 100.  The 'bull trap' in the Semiconductor index is now negated.

Overreaching Enthusiasm?

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Bullish monetary policy rumblings from China and Europe had kick started a bright opening for markets, but the feel good factor gradually wore off as the day lengthened, and in the end, the day felt oddly bearish. The S&P closed with a bearish inverse hammer, which could turn into a bearish shooting star if there is a gap down on Monday. Volume climbed to register technical accumulation, but this could mark significant overhead supply if sellers come back tomorrow. I have widened the Fib levels for the next decline. Note, pending MACD trigger 'sell,' although other technicals are in good shape.

Bulls Pressure Highs, Big Recovery in Small Caps

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Another good day sent indices back to highs, but it was the Russell 2000 that probably came out best.  Yesterday's losses in Small Caps were consumed by a bullish engulfing pattern. The index defended its 20-day MA, although stochastics weren't oversold,which would have strengthened the engulfing pattern.

Early Losses Couldn't Kill Yesterday's Gains

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It was a decent, yet unspectacular day for the indices. Early losses were clawed back by the close, but there was no push higher. The S&P is nicely positioned to gain.  The inside day at oversold conditions is typically bearish, but I'm not sure today was.

Semiconductors Breakout, While S&P Makes Its Move.

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A solid day for Semiconductors saw a solid breakout from the recent handle (without a violation of the measuring gap), which even managed to mount a challenge on the September 'bull trap'. It still has a bit of work to do to get to new highs, but bulls have shown their hand, and now it's up to others to follow suit. This - to me - looks good for a push to 700s, but even a move back to 600 would offer the possibility of a head-and-shoulder bounce: lots of room for bulls to work with here.

Russell 2000 Experiences Increased Selling Pressure

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In real terms, today's selling in the Russell 2000 was relatively light, but it was the only business in town. The selling brought the index back to handle support, but it hasn't violated the gap, and there is a 50-day MA which 'golden crossed' with the 200-day MA to provide support.

Minor Gains Continue as Semiconductors Shape Handle

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While I'm late with this weekend's update there was very little to add from Thursday. Best of the action remains in the Semiconductors, which is shaping a solid handle in preparation for a possible break higher (ignore the 'Death Cross' between 20-d and 50-d MAs - this is now a 'Golden Cross').

Wide(r) Range Day Breaks the Monotony

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There wasn't a whole lot going on today. The Russell 2000 closed with a potential 'bull trap' that could evolve into something bigger, perhaps the only index offering shorts anything as of today's close.

Russell 2000 Adds to Breakout

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Wednesday proved to be a relatively quiet day. Large Caps managed to keep themselves out of the limelight with a mid-morning recovery after an opening sell off. Best of the action belonged to the Russell 2000. It was able to put some distance on a tight handle consolidation, which sets it up for a move to challenge resistance at 1,208.

Swing Trade Tuesday's Narrow Range

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All indices traded themselves into very narrow ranges - offering the potential for a big move once today's high/low are breached. It's the kind of market where everyone is expecting the rally to collapse, but no one wants to make the first move. Which is why this rally will probably keep moving higher; even if all buyers are in, shorts will have to cover if there is another surge - which will bring more buyers in. One thing which is happening is the reduction in buying volume. The S&P is unchanged.

Further Minor Gains Extend Rallies

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There wasn't much to today or Friday, but bulls kept the pressure on shorts in existing positions. The Russell 2000 had the best of the (modest) action, edging a breakout from the narrow, 6-day handle. A move to upper resistance remains favoured; watch for a 'bull trap' on an undercut of breakout support.

Dow Pushes Well Past Breakout Support

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Another day of gains for markets, but it was the Dow which is best positioned to benefit. The Dow is out of range of the easy short with an undercut of breakout support: one day of loss might not be enough to see this level tested, given net bullish technicals and a MACD at a new high.

Some Bullish Follow Through To Yesterday's Breakout Defense

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The shorting opportunity presented on yesterday's intraday close didn't last the morning. The S&P opened above 2,009 support and this level didn't get a look in through the day. I have widened the Fib levels, but there is a chance it will push higher tomorrow.

Late Rally Maintains Breakout Support for a Second Day

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Today looked a lot more bearish on an intraday chart than it did on the daily chart. For example, the daily chart in the S&P closed with a bullish hammer, but as with any reversal candlestick, a 'bullish' candlestick is considered bullish when in an oversold market - and this is not an oversold market.  However, the rally did enough to maintain a close above 2,009.

Pause in Rally Maintains Friday's Gains

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Friday's breakouts were small, and vulnerable to selling and 'bull traps', but today's action stayed close to Friday's highs, keeping bulls happy. The S&P has breakout support at 2,009 to work with, but it's hard to see this holding when sellers do return. The S&P has Fib levels, of which the 61.8% level close to the 200-day MA would offer an ideal opportunity - but there are plenty of support levels to work with on its way there.

Indices Break to New Highs

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Another days' gain, another set of breakouts in the bank. The Dow took out the September 'bearish evening star' with Friday's close.  At some point, this rally will have to confirm one of these levels as support, but for now, a new support level has been created.

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