Sellers Return

Profit Takers return after a two days of buying.  The selling remains confined to broader trading ranges, which remain dominant until breached.

In the case of the S&P there is 'bear trap' support at 2,080 and resistance at 2,115 to consider. Friday's action let it in the middle of this range, just below the 50-day MA. Volume was lighter, which weakened the importance of the selling.

The Nasdaq is easing back to converged wedge support and 5,038. As with the S&P, trading volume was lighter. Bulls may get some joy with a bounce off converged support with the index close to new all-time highs.

The Russell 2000 cleared the tentative downward channel. Friday's action retesting the channel with a neutral 'doji'. Monday could see a drop back inside its channel, but should it do so then the presence of converged 20- and 50-day MA support (1,252/4) could offer the opportunity for bulls to mount another round of buying.

If there is an index which bears may get some joy it's the Dow Jones Index. Short term, a push back to the 200-day MA (also near horizontal support of 17,625) might deliver a quick return before a another bounce like the one in February is mounted.

Depending on Greece, Monday is likely set for another round of profit taking before bulls feel comfortable buying. A resumption of the trend will require a break of trading ranges, but there is nothing established yet in this regard.

You've now read my opinion, next read Douglas' and Jani's.

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Dr. Declan Fallon is the Senior Market Technician and Community Director for, and Product Development Manager for I do a weekly broadcast on Friday's at 13:30 GMT for Tradercast, covering indices, FX and gold, silver and oil - all are welcome! You can read what others are saying about Zignals on


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