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Daily Market Commentary: Stall Day 2

Daily Market Commentary: Stall Day 2

Courtesy of Fallond Stock Picks 

It was a roller coaster of a day but in the end markets finished slightly lower. Early action saw challenges on resistance as marked by Monday’s highs, but markets were unable to push their advantage.

The S&P finished with a ‘spinning top’ on heavier volume; volume was enough to generate a sell trigger in on-balance-volume. There is an upcoming ‘golden cross’ between 20-d and 50-d MAs which means the 20-day is going to be the support area on the pullback.

($SPX)

via StockCharts.com

The Nasdaq touched bases of the 200-day and 50-day MAs. With the declining trendline (former channel resistance) to work with there is a chance we will see buyers make a stronger stand at the convergence of trendline, 20-day and 50-day MAs. 

($COMPQ)

via StockCharts.com

The Russell 2000 played to form and tested the converged 20-day and 200-day MAs. If the market closes lower tomorrow it would suggest converged MAs will not hold. 

($RUT)

via StockCharts.com

The Dow violated former trading range resistance to take it down to its 200-day MA, but in the end closed the day just a hair above – keeping the breakout intact.

($INDU)

via StockCharts.com

Semiconductors played off all three moving averages; 20-day, 50-day, and 200-day MAs – finding support at the latter. The sideways trading range is still dominant but if buyers are going to play ball they will need to step up to the plate soon.

($SOX)

via StockCharts.com

Tomorrow’s interest will focus on Semicondutors, Russell 2000 and the Dow – buyers don’t have much room to maneuver if they are to defend key moving averages in these indices. A weak close tomorrow – even one which held these moving averages – would be an omen for worse to come.


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