Daily Market Commentary: Bull Trap Nasdaq 100

Troubling action in the indices. Large Caps escaped relatively unscathed despite the heavy loss as channel support held. Tech have a little more support to work with but also suffered distribution. Small Caps were just kicked in the teeth with areas of support running out. I had talked about the importance of the Nasdaq 100  but today's distribution selling looks to have generated a 'bull trap'. The selling brought the index below its 200-day MA, although the 50-day MA remains available as support. However, the damage looks done and shorts will be looking to take advantage of any low volume retest of 2,337. ($NDX) via The index struggling most is the Russell 2000. The index finished the day at minor support but the loss of the 20-day MA leaves 650 as the only major support level protecting against a collapse. Adding to the misery was the loss of nearly 3.7% - by far the worse performing index. Buyers have to step in tomorrow if a broader rout is not

Daily Market Commentary: Techs Ease

After a promising start markets gave back the gains banked by early afternoon. This in itself was unusual as recent trading often resulted in gains for markets into the close. There was also a push towards distribution in the Nasdaq 100 - the lead index. The S&P reversed from declining 50-day MA resistance. Luckily, selling volume was light. There is a squeeze in play with a rising 20-day MA fast approaching the falling 50-day MA. This congestion could result a strong move in the direction of the moving average break (depending on which moving average breaks). ($SPX) via Small Caps are experiencing greater struggles. The index lost almost 2% on the day, cutting below 20-day MA support. The index is significantly under-performing relative to the Nasdaq. Another down day tomorrow and it could be curtains for this and other indices. ($RUT) via The index to watch, the Nasdaq 100, had started brightly but by the close of business it was down

Daily Market Commentary: Tech Take the Glory

Monday started poorly with weak Futures and this remained the theme throughout the day for Large and Small Cap stocks. However the Nasdaq and Nasdaq 100 were able to beat the malaise and put in a strong finish. The Nasdaq 100 had the best of the days action. Friday saw the push above converged resistance and 200-day MA on higher volume accumulation and today saw the breakout maintained. The Nasdaq 100 is the first index to turn net bullish technically. ($NDX) via Technicals for the Nasdaq turned net bullish today, although consolidation resistance has yet to be breached and the 200-day MA is a long way from been challenged. ($COMPQ) via Supporting rallies in the Nasdaq and Nasdaq 100 is the semiconductor index. Unlike the aforementioned index it closed over 1% lower, although it did so after challenging resistance in the 381-385 range. The index has its 50-day MA nearby to lend support on this pullback. ($SOX) via Tomo

Weekly Market Commentary: Weekly Accumulation

Bulls stepped up the buying to finish the week with net accumulation. The 'bear flags' across the different indices remain intact, but market breadth offers enough to suggest the rally will continue. The S&P closed just a shade above a thick band of resistance at 1,209. It's a fine line as to whether it counts as a break or not. In favor of the bullish thesis is the stochastic 'buy' signal on the higher volume accumulation. ($SPX) via The Percentage of S&P Stocks above the 50-day MA climbed to 43.8%. Even if the recent reaction low proved to be a false bottom as in October 2008, there is enough to suggest the rally could continue for another 1-2 weeks. ($SPXA50R) via The rally in the Nasdaq took the index from bear flag support all the way to resistance. Volume buying was good, so there is reason for optimism for the 'bear flag' to break this week. And the Nasdaq Bullish Percents also saw a 'buy&

Daily Market Commentary: Important Tests

After a continuous sequence of gains markets have approached areas of potential (strong) resistance. The only indices with room to maneuver are Large Caps: S&P and Dow. The S&P has plenty of room before it gets to channel and 50-day MA resistance. Other indices are more likely to influence tomorrow, so expect Large Caps to follow - not lead. ($SPX) via The Nasdaq finished at converged 2,616 and 50-day MA resistance. Shorts will be chomping to take down the 4-day rally; will they succeed? ($COMPQ) : via Resistance in the Nasdaq 100 is a little stronger given convergence resistance is at the 200-day MA, not 50-day MA. The main plus is the net bullish turn in technicals. ($NDX) via While the semiconductor index also has resistance to overcome at 381. ($SOX) via Small Caps did little today and are unlikely to do too much tomorrow. All eyes should be on Nasdaq, Nasdaq 100 and Semiconductors

Daily Market Commentary: Net Accumulation

Buyers returned after two days of low volume gains. Gains coincided with breaks of supply, chiefly the 20-day MA in the S&P and the 50-day MA in the semiconductor index. Starting with the S&P. The index pushed above its 20-day MA (something the Dow couldn't achieve) at the same time relative strength shifted from Large Caps to Small Caps (bullish). ($SPX) via The Nasdaq was able to cut through its September 'bull trap' and head towards a test of converged resistance at 2,616 and declining 50-day MA. ($COMPQ) via Nasdaq breadth (as marked by the Summation Index) is on the verge of a net bullish signal. This would offer a bullish environment for the Nasdaq of a few weeks at least. via Although the Nasdaq 100 was pegged back by its 50-day MA (and is close to wedge resistance) ($NDX) via The semiconductor index left no doubt. It blew past its 50-day MA setting up a challenge on 381

Daily Market Commentary: Inches Higher

Markets did what they had to do without doing a whole lot. Volume dropped again - although there was enough buying to see on-balance-volume 'buy' triggers for many of the indices. But the real winner was the semiconductor index. It cleared channel resistance and finished just below its 50-day MA. The 50-day MA held as resistance in May, June and July - so will it be fourth time lucky? A push through the 50-day MA would really get sideline money excited. Definitely the index to watch. ($SOX) via The S&P managed to squeeze itself even more by its 20-day MA without actually breaking through. Despite the on-balance-volume 'buy' trigger this index needs something more to excite. Remains vulnerable given proximity to support. ($SPX) via The Nasdaq was able to push above its 20-day MA and is about to challenge the 'bull trap' for a second time. With the semiconductor index turning more and more bullish by the day it can


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