Tuesday, April 5, 2011

Daily Market Commentary: Markets Finely Poised

There wasn't a whole lot going on in lead indices. The S&P finished with a low volume doji which could offer a swing trade opportunity on break of high/low (stop on the flip side). Technicals are bullish and rising, so the expectation is for a break to the upside. But a double top can't be ruled out either - for this to confirm it will require a (swift) move back and below 1,260.


via StockCharts.com

The Nasdaq finds itself with another indecisive doji (next to Friday's shooting star) bang on gap resistance. The February gap down dominates and if it's a true breakdown then it's a gap which cannot be filled. Should the gap fill then 2,840 won't be long for resistance. Aggressive bulls can buy break of 2,800, while shorts will be looking to cover around 2,832.


via StockCharts.com

Helping bulls is a confirmed net bullish stance in Nasdaq Bullish Percents and Summation Index


via StockCharts.com

via StockCharts.com

Semiconductors suffered a third day of losses having been pegged by declining resistance. But the afterhours buyout of National Semiconductor by Texas Instruments will generate plenty of interest in this sector tomorrow. But bulls have their work cutout. The first challenge is to crack above declining resistance and nearby 50-day MA. Then it can go on to challenge the 2011 high. Strength in semiconductors will also help the Nasdaq and Nasdaq 100.


via StockCharts.com

While the Russell 2000 broke the bearish divergence in its MACD.


via StockCharts.com

Tomorrow will be very interesting. I suspect bulls will be the happier, but bears are not without opportunity from breakdown gaps and/or double tops. On a positive front, tight stops can be played on both sides of the fence.

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