Thursday, February 28, 2019

Volume selling picks up as prices hold

While sellers ticked up their activity there were enough buyers to keep prices stabilized, although supporting indicators have started to slowly rollover.  The one exception was the Semiconductor Index as it started the day at channel support and rallied higher.

While the Semiconductor Index rallied off channel support it was left with a 'sell' trigger in the MACD and CCI. Price action is dominant so I have marked a 'buy' trigger at support but use a loss of the channel line as support.

The S&P remained glued to resistance after a tentative breakout earlier in the week struggled to gain traction but the opportunity for some follow through remains. Unlike for Tech averages, volume was lighter.

The Nasdaq remained ahead of its 200-day MA with higher volume selling marking distribution - although the lack of any real price loss suggests churning, while itself is bearish, is not as damaging as straight distribution selling, particularly as the Nasdaq is above its 200-day MA.

The Russell 2000 is lurking near its 200-day MA, but despite spiking above-then-below the moving average it has done well to stick around. As with other indices it has switched to a MACD trigger 'sell' and ROC has remained disappointingly on the bearish side of the fence even with a 25%+ gain off lows.

The Dow Jones Index has moved well beyond its 200-day MA and if sellers make an appearance it has the most wiggle room to defend this moving average.  It too has a MACD trigger 'sell' to contend with too.

For tomorrow, look for bulls to take the Semiconductor higher off channel support and for gains in the Nasdaq and Nasdaq 100. If bears maintain control after the first 30 minutes of trading then look to the Russell 2000 to pull away from its 200-day MA.

You've now read my opinion, next read Douglas' blog.

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Investments are held in a pension fund on a buy-and-hold strategy.