Daily Market Commentary: Small Caps Struggle - A Little...

The sequence of low point gains on heavier volume continued.  The only index to buck the trend was the Russell 2000. However, it's losses were as small as gains in other indices. In addition, small losses weren't enough to knock the index outside of a rising channel, but relative strength has shifted away from Small Caps towards Tech averages (and S&P). The Nasdaq may have added less than 0.5%, but trading volume was significantly heavier. The index remains in good shape as it rides along channel resistance. The S&P continued with another of its narrow range days. Markets ticked higher at a solid pace.  Recent gains leave the index well positioned to move higher or at least tolerate a small loss and remain bullish.  The Russell 2000 is looking like it will be the index to first test support of narrow rising channels. Watch it closely for leads. ------- Follow Me on Twitter Dr. Declan Fallon is the Senior Market Technician and Community Director

Daily Market Commentary: Rally Ticks Along

Yesterday's low volume declines were followed by today's higher volume gains, albeit small rises in lead indices. Only the Russell 2000 suffered a mild loss. The S&P 500 is well positioned to add to its rally as it managed a new closing high. The MACD recovered from its 'sell' trigger. The only negative is the overall lightening of the volume despite the accumulation days. The Nasdaq is riding against channel resistance as it continues to pull away from Large Caps (in terms of relative strength). As the semiconductor index rebounded off trendline support. The Russell 2000 is closer to the center of its channel. It holds a small edge over the Nasdaq (relative strength). Markets are in their most bullish alignment of Small Caps leading Tech leading Large Cap indices. With the majority of indices posting new highs there are is little in the way of overhead supply. All good for keeping the rally moving onwards and upwards. ------ Follow Me on T

Daily Market Commentary: Consolidation

Markets eased up on light volume, consolidating Friday's gains. The semiconductor index suffered the worst of the selling, but its losses were well within the boundaries of a pullback. While the Russell 2000 flashed a potential bearish harami cross; look for a retracement to the rising trendline. But the Nasdaq finished well placed to push higher. The chief concern would be an exponential blowout top, but so far nothing indicates this is about to happen. The S&P had a very low key day with little to say about it. Tight action could offer a trade opportunity off a break of the high/lows with a stop on the flip side, but the broader trend remains bullish and trades with a perspective longer than the next couple of days would be best to stay on the right side 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 ma

Weekly Market Commentary: Breakout in Nasdaq

A good week for the indices and the Nasdaq in particular. The Nasdaq pushed to a new multi-year high on higher volume accumulation. It has the look of a solid breakout which can probably withstand a few weeks of weakness before pushing on. Assuming a period of consolidation follows it will be important for 2,700 to hold. Nasdaq Breadth continued to improve. The Percentage of Nasdaq stocks above the 50-day MA cleared a set of reaction highs dating back to the latter part of 2009, leaving the single swing high created from the rally off the March 2009 low at 83% as the last area of resistance. This strength may offer enough the groundwork for a 1 year+ rally. The Nasdaq Bullish Percents have plenty of room to maneuver before turning overbought; another reason to suggest there is more to come. There was another powerful push in the Summation Index, the fourth big move in a row - impressive stuff and one which suggests a slowing of this rally is another few weeks away.

Daily Market Commentary: Small Change

Today's action amounted to a bit of a non-event. Tight price action was combined with low volume. The quiet action did little to change the broader picture, or the technical health of the indices. The only point of interest in the S&P was the increasing disparity in relative strength between the S&P and Russell 2000. While the Nasdaq continued to pull away from the S&P as prices continued inside the rising channel. But there was little change when the Nasdaq was compared against the Russell 2000. Despite the lack of interest on the part of traders, bulls can still be considered to be holding court. ------ 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 also view the top-10 best trading strategies for the US, UK, Europe and Rest-of-the-World in the Tr

Daily Market Commentary: Rally on Higher Volume Accumulation

Yesterday's tight action gave way to broader gains on higher volume. Tech and Small Cap indices enjoyed the best of the gains, helped by a very strong gain for the semiconductor index. Gains in the Russell 2000 helped push supporting technicals back into firm overbought territory. Russell 2000 gains were enough to swing relative strength back Small Caps, although the long term relationship is in flux. Nasdaq gains were not as great as for the Russell 2000, but the tight rising channel remains intact. The semiconductor index was where most of the driving was done Large Caps stayed in touch with gain in Small Caps and Tech indices, although there is a growing separation in relative strength between Large and Small Caps, to Small Caps - and bulls - favor. While the rally chugs along the 20-day MA remains a good place to trail a stop or take advantage of pullbacks.  The only negative on the day was the inability to reverse the MACD 'sell' trigger in the S&

Daily Market Commentary: Light Losses on Low Volume

It was a mixed day for the indices. Large Cap indices suffered small losses on lighter volume. Tech averages made a small gain on higher volume. Small Caps played closer to Tech action. The S&P will likely see another pass made on its 20-day MA on Wednesday. The 'sell' trigger in the MACD suggests the 20-day MA will not be support, but while the index is above this moving average it's offering a (somewhat weak) buying opportunity.  Non-MACD technicals remain healthy. The Nasdaq has been riding a very tight channel.  This won't hold forever, but until breached it's a buy at support and sell at resistance - today's close was at channel support. However, an opening gap down Wednesday would probably play better as a short with a stop above Tuesday's high. The Russell 2000 is seeing an ever increasing shift in momentum from Small Caps to Tech stocks (see relative strength along the bottom). For tomorrow, there is a weak 'buy' opportun


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