Stronger bullish action for the Nasdaq and S&P as Russell 2000 suffers again

Sellers tried to put the squeeze on the indices with a large intraday swing lower, but by the close of business those loses were recovered for some of the indices.

The Nasdaq had undercut its 20-day MA with a quick loss, but it recovered to finish with a 'bullish' hammer.  However, as the index is not oversold in momentum it's not a strong bullish candletick. Technicals are mixed with a 'sell' trigger in the MACD and ADX, but bullish On-Balance-Volume and Stochastics.  Selling volume was lighter, so there is no distribution. 


The S&P had flashed a sequence of narrow, tight-range candlesticks up until today, but today offered a wide range hammer which saw buyers step in to claw back intraday losses. It was enough to leave the index at a new all-time high after looking like it was going to be a confirmed day of selling. Ultimately, it proved to be an accumulation day but overall trading volume was light - in line with vacation trading. 


The Russell 2000 gapped below its rising wedge and it remains to be seen if there is a measured move lower down to - and below - trading range support. However, there is a 'sell' trigger in On-Balance-Volume, ADX and relative performance loss to the Nasdaq. 


Markets continue to diverge with gains in the Nasdaq and S&P countered by losses in the Russell 2000.  The latter is more worrying as a move to trading range support would look to be a minium target and this will have an obvious (negative) knock on effect on the S&P and Nasdaq. 

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

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

Friday's gap downs bring indices close to support. Semiconductor Index at 200-day MA.

Image
Friday's big gaps lower have the potential to become breakdown gaps, but for now, the near term oversell has for a possible move into the gap price vacuum. The index most likely to achieve this in the coming days is the Russell 2000 ($IWM). The Russell 2000 ($IWM) finished with a neutral doji, just above its 50-day MA and in a thick band of support between $207.50 and $210 marked by the summer swing highs. Technicals have followed price action with new 'sell' triggers in On-Balance-Volume and ADX, but intermediate term stochastics haven't reached the mid-line that is typical support in bull markets. Aggressive bulls can look for a move to test the underside of the 20-day MA. The S&P was unable to hold its 50-day MA on Friday's open, and instead found itself toying with the May swing high. More significant support is likely to be found around 5,265, so if there is an undercut of Friday's low then this will be the next port of call. More concer...
Read more

Big bearish engulfing patterns as positive start negated

Image
It was a setting up to be a low key day, but come the afternoon, sellers pounced and drove markets down hard after doubts raised on future rate cuts. Fed news wasn't the key takeaway, but the loss of support was. The S&P was hardest hit, not because of the percentage loss, but because of the volatility relative to recent trading action. Today marked a clear breakdown of trendline support. It should be noted, the presence of the 50-day MA offers a point of defence but today's loss does not mean we will see a crash; a time-led consolidation seems more likely. Technically, the MACD accelerated its losses and there was a fresh 'sell' in On-Balance-Volume.
Read more

Archive

Show more