Daily Market Commentary: Higher Volume Accumulation

Another good day for the indices leaves things a little uncertain for tomorrow. The last swing highs are fast approaching but these will add supply on further gains. The S&P closed above its 200-day MA, maintaining 1,260 support. The Nasdaq edged over its 200-day MA and is only a day away from testing the October swing high at 2,753. The Russell 2000 defended 731 support. Meanwhile, the 'bull trap' which played on the initial break of 731 is under threat of negation. Tomorrow is a little trickier to play. The highs of 'bull traps' are the next challenge but whether there is the demand to see this happen tomorrow remains to be seen. The good news is bulls are in firm control of the market. ------- Follow Me on Twitter Dr. Declan Fallon is the Senior Market Technician and Community Director for . I offer a range of stock trading strategies for global markets which can be Previewed for Free with delayed trade signals. You can al

Daily Market Commentary: Closes at Day's Highs

Today's finish was a continuation of Friday's action. Market were able to push it a little further by ending the day at the highs. The only disappointment was the lighter volume (very light volume). The Nasdaq was to able to finish the day above its 200-day MA. Technicals are wavering with the MACD on a 'sell' trigger as the Directional Index continues to fall (i.e. trendless environment). The S&P popped over 1,260 resistance (now support). The 200-day MA remains resistance as the 20-day MA offers support at the lows. The Russell 2000 defended 731 support at the low for a third day in a row with additional support at the fast rising 20-day MA. The index is nicely positioned for a push to 773 resistance. For tomorrow, look for a solid push higher to finally negate the various 'bear traps'. While overnight news may change things, I would be surprised if markets broke below 3-day lows given past trading action and the presence of 20-day MAs as

Weekly Market Commentary: Maintains Prior Week's Gains

For the likes of the S&P and Dow, last week's respectable finish was about holding on to the gains generated by the breaks from the 'Bear Flags'. However, indices like the Russell 2000 and Nasdaq remain pinned by their 'Bear Flags'. Overall, markets are finely poised with bulls looking at the emergence of a fresh rally while bears wait for the inevitable reversal. Influencing this psychology is the mess otherwise known as Europe which will keep both sides on their toes as they look to navigate a path ahead.  Bulls have the seasonal advantage of the 'Santa Rally' to leverage against, while Bears have a choice of PIIGS to continue their spoiling tactics. Looking at individual indices, the Dow held its break of dual band resistance at 11,739 and 11,939 with selling volume lighter than prior week's buying. While the S&P remains well above 1,209 support but still pegged by 1,300 resistance. However, it is working with a breakout so the edge lie

Daily Market Commentary: 'Bull Traps' Pressured

Markets enjoyed a second day of gains to take them into the intraday range of last Thursday's thrust higher. Volume climbed to register a day of accumulation which helped build on Wednesday's gain. The question now is whether bulls have sufficient demand for stocks to push a new high for the impressive October rally? The S&P edged above 1,260 resistance to turn it back into support, but still has to contend with 200-day MA resistance at 1,273. Technicals returned 'net bullish' after a brief bearish switch in ADX. It might be a tall ask for a third straight gain in a row, but to finish above 1,260 would be a handy victory for the week. The Nasdaq was able to finish Thursday above its 200-day MA, so it only has to consider the most recent swing high at 2,753 as resistance.  Beyond that it has room to rally before it can mount a challenge on July's 'bull traps' starting at 2,836. The Nasdaq and Nasdaq 100 have enjoyed strong runs and are well positio

Daily Market Commentary: Support at 20-day MAs

After two days of selling today was finally an opportunity for bulls to make a stand. Unfortunately, most of the work was done premarket.  By the time markets opened the majority of today's gain was already priced in. However, confirmation of support at 20-day MAs does offer a stepping stone for a rally longer than a day. The S&P is on course to test 1,260 resistance which is also the start of the 'bull trap'. This test may come as early as tomorrow. The Nasdaq didn't get far from its 20-day MA and yesterday's gap down from the 200-day MA remains dominant. However, this gap is also a void which can be filled; early strength could see this gap closed quickly. Small Caps performed strongly and finished just above 731 resistance (now potential support). But more importantly, can start the process of negating the 'bull trap'. Watch the Russell 2000 closely tomorrow. The challenge tomorrow is seeing how much bullish follow through can develop

Daily Market Commentary: Confirmed Distribution

While Monday's selling could have been attributed to profit taking, Tuesday's had more in common with panic selling. Volume climbed significantly as indices were driven down to (or just below) support and/or 20-day MAs. Indices at 20-day MAs offer a long-side play from the open - assuming no gap higher. The S&P was pushed further away from 1,260, confirming a 'bull trap' which will be a source of supply on the next rally. Tuesday's close on the 20-day MA will offer traders a short term play off the open assuming the index starts the day at its 20-day MA. The selling volume is a concern and should the market weaken pre-market then the next opportunity for buyers will be the 50-day MA currently at 1,190. The Nasdaq is on firmer footing. The morning gap down didn't lead to a broader sell off (bad though the gap was) and the index was able to finish the day near 2,616 support and its 20-day MA. Despite the proximity of support the Nasdaq has under-perform

Daily Market Commentary: Profit Taking

After the extremes (at least on the daily timeframe) of last week it was inevitable there was going to be a fall.  Early European action suggest there will be some follow through today. The S&P lost 200-day MA and the break of 1,260 support, trapping buyers above 1,260, but doing so without generating panic selling (trading volume was light). Of greater importance is how the index behaves when it makes it back to the 20-day MA or 50-day MA. Monday's loss is a warning shot, but nothing out of the norm. The Nasdaq has more breathing room despite the nearly 2% loss. Monday's finish saw 200-day MA honored with the 20-day MA fast approaching significant support at 2,616. Tech averages remain in good health and yesterday's selling did little to change that. The Russell 2000 has managed to outperform the Nasdaq in recent weeks, although it did so from a much weaker starting point. The index maintained its break of 731 but as yet to challenge its 200-day MA - this m


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