Some Bullish Follow Through To Yesterday's Breakout Defense

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.


The Nasdaq is holding above 4,601, but finished with a lower close. The breakout remains in play, but is more vulnerable to a 'bull trap' than the S&P.


The Russell 2000 hasn't broken past key resistance, and is loitering around another level of resistance at 1,180. Today's 'black' candlestick suggests there will be further inroads into last week's gap.


However, the Semiconductor Index posted a gain which brings it closer to 652 resistance. Note how its relative performance against the Nasdaq 100 has swung recent action in its favor. Bulls probably have the best chance in this index.


Tomorrow is well placed for bulls to continue their advance. The risk is a 'bull trap,' but it will require a close below breakout support. A 'bull trap' will be a shorting opportunity.

---

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, and Product Development Manager for ActivateClients.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