Sellers make a strong stand on Friday

There was to be no reprieve for buyers on Friday. In the past, buyers have managed to step in to provide a bit of gloss on a bad week to give bulls some optimism for Monday, but there was no such reprieve today.

But as I was saying about strong days in a trading range - the same applies for weak days too.  The Russell 2000 gave up over 1% in a move which undid Thursday's neutral doji, but with this occurring inside the trading range it's damage is not as significant.  The 200-day MA is fast approaching, so this might be the next test.


Nasdaq losses dropped the index to its 20-day MA, but breakout support near 14,200 - down where the first Fiboanacci level is - remains the most likely area to see a test before the month is out. We have a MACD trigger 'sell' to go with a new 'sell' trigger in On-Balance-Volume. 


The S&P held its gains better and has yet to test its 20-day MA. Friday's selling ranked as distribution and came with a 'sell' trigger in the MACD, but it has the most wiggle room to work with.


Heading into next week we want to see how indices react to Friday's selling and if there is any hangover from it.  The #stockbreakout scan was very poor as there were only penny stocks on the list - a first for this scan.  Even if the selling continues, it's going to be a while before key support breaks.

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

Share on StockTwits

---

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.

Follow Me on Twitter


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

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