Fallond Stock Picks

Stock Market Commentary: Bullish Technical and Accumulation Day

noreply@blogger.com (Declan Fallon) — Mon, 09 Nov 2009 13:47:45 PST

It feels like it's summer all over again. For some indices this was the first accumulation day in weeks, but for all it was a significant technical improvement. The market has the look and feel of the July reaction low with market breadth in a very similar position.

The Nasdaq enjoyed a solid break of the 20-day MA with a bull cross for stochastics, on-balance-volume and directional index [+DI > -DI]. Only the MACD has left to turn. There was enough buying to register a modest accumulation day, similar to the summer but below the buying of September.

The Nasdaq 100 went a step better with a MACD trigger 'buy' and therefore a net bullish technical picture; note the strong out-performance relative to small caps.

The Dow gives some indication as to what may come for the Nasdaq et al. A solid performance pushed it to a new closing high for the year with all technicals net green (today saw a MACD trigger 'buy'). Large Caps don't normally lead but that is not to say they can't.

The only real concern is for small caps which closed just below converged ('death-cross') 20-day and 50-day MAs. Given what has passed for the other indices it's hard to see how this can make the same level of recovery.

As I stated near the beginning, market breadth is in a very similar position to that of the July reaction low; have we enough to see a rally into the New Year? My predictions for breadth played out better than my expectations for the Nasdaq!

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Weekly Review of Stockcharts.com Publishers' Charts

noreply@blogger.com (Declan Fallon) — Mon, 09 Nov 2009 14:00:35 PST

With the launch of the new Zignals website with its Trading System builder and all-in-one Dashboard I have had my hands full. But this week I can return my attention to the market. Today is producing what could be another big day for the market; but is it sustainable?

Anthony Caldaro of Objectiveelliottwave.com has marked in what looks to be a new 5-wave structure down as part of an 'ABC' correction ('B' in place from October's high); the current move is wave 2 which should peak below October's high.

Yong Pan of Cobrasmarketview holds to a more bullish short term picture and bearish intermediate picture. With the VIX getting hammered it doesn't look like bulls will be giving up anytime soon (the VIX can and has been much lower).

But Yong Pan has called 2 major distribution days inside of 5 as the start of the next down-leg (on an intermediate time frame - so the short term bullishness shouldn't have much juice left in the tank).

But today has seen the SPY crack through converged resistance

With a head-and-shoulder target for the S&P of 1,246

Richard Lehman has launched a new site: Trendchannelmagic.com. His weekend comments are below and he is no doubt pleased with today's start given what he said:

11/7 -- The immediate picture is clearly up for most indexes as you can see from blue mini channels on the short term charts. Most, however, are at the upper lines of those minis and therefore subject to some weakness early in the coming week. I drew in a possible larger downchannel on the Dow hourly chart, which appears to be influencing the index somewhat, but to be honest, I expect the blue mini channel to break through that line to the upside this week.

The more important issue is in the longer term charts now. Action in the last several weeks shows waning momentum in the uptrends from March along with a de-coupling among the indexes. Gold, for example has accelerated upward, while oil has flattened considerably. Higher beta sectors such as financials, technology and China stocks have flattened. The communications index may even be rolling down. The small caps have corrected more than large caps.

This shouldn't come as a surprise. The uptrend in the markets from the March bottom cannot sustain itself at the same pace going forward. If it does, we would recover to mid-2008 levels by the first quarter of 2010, and that hardly seems warranted, given the damage to the economy, the lessening effects of stimulus, and the general distaste for paying a big premium now to own stocks.

The one-year charts show that the upper green channel line from March has been touched 5-6 times now by the broad indexes, but the lower line, was only touched once at the July bottom until now. The small cap indexes have all just touched that lower green a second time. For the SPX, that line would be at 1000 or less right now and for the Dow, around 9500. Bear in mind that this lower green channel line doesn't even come from the actual March low -- correcting down to a line off the actual low would take the Dow, for example, back to 8500, at the current time.

To me, the picture says we will likely flatten some more with the Dow seeing perhaps one more peak between 10,000 and 10,500 before drifting down toward 9500.

Ted Burge and his tedlines.com looks to me like there is still some room to resistance for large caps:

While the Nasdaq 100 appears to be already there:

Joe Reed shows the break in the Gold and Silver Index - although a broadening wedge could also be drawn on the action (bearish)

Finally, Matthew Frailey has a very interesting chart showing the divergences between GE and the S&P.

Looks like bulls have enough to get this close to a test of October highs. The question is whether bears are willing to step into the fray to contain this uber-stretched advance.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Archived stock chart review from March 2008

Weekly Market Commentary

noreply@blogger.com (Declan Fallon) — Sun, 08 Nov 2009 13:32:17 PST

It was a week where bulls made the most daily headway, but the weekly picture offers a more bearish slant. Weekly market technicals all fell but momentum indicators still hold enough to stay on the bull side - just. The Nasdaq closed the week with a MACD trigger 'sell' but stochastics are comfortably overbought. The index also held 2,020 support.

The Nasdaq 100 continued its battle around 1,702 support with a MACD trigger 'sell'

Meanwhile, the Russell 2000 looks ready to test neckline support c517

Prior comments on the Bullish Percents still hold true; big down weeks don't immediately translate to market weakness.

The Percentage of Nasdaq stocks above the 50-day MA is at a support low, but unlikely to be the low for the ongoing decline

As the Nasdaq Summation Index is only halfway to its likely low

Markets have probably seen their first significant reaction low for the decline, but I would be surprised if the current bounce makes it to new highs. However, that does not mean the current rally is done and at least another week of gains is probably on the cards.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Stock Market Commentary: Bulls Start Well and Maintain It

noreply@blogger.com (Declan Fallon) — Thu, 05 Nov 2009 14:00:03 PST

After Yesterday's close it looked like bears would run rampant, but instead what emerged was a gap higher and more improbable (in my opinion) run. Volume was a little disappointing but one can't deny the points on the board.

First up, the Nasdaq cleared its 50-day MA.

The Nasdaq 100 managed a little better; it broke through its 50-day MA and made it to its 20-day MA.

The Dow enjoyed one of its biggest days - the kind of day last seen during the July bottom (without the volume).

The Russell 2000 recovered the points it lost when it cracked through 576 support. It's next fight is up at converging 20-day and 50-day MAs.

Breadth indicators are close to an intermediate oversold condition and are mapping in a manner which is close to what I would have expected for them; given that, the rally should offer a little more legs.

So watch those overhead 20-day and 50-day MAs.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Stock Market Commentary: Disappointment for Bulls

noreply@blogger.com (Declan Fallon) — Wed, 04 Nov 2009 14:10:02 PST

The bright start made by bulls was quickly erased by the close as a combo sell-the-news 'Fed Factor' and House vote on credit card rates kicked in. While not outright bearish it does set up an aggressive play for shorts to push into Tuesday's gains.

For the Nasdaq, prices are left clinging to channel support. Today's distribution makes holding support tomorrow more difficult with overhead supply at the 50-day MA available. Will this evolve into a head-and-shoulder (bearish) reversal pattern? If so, the right-hand-shoulder will emerge c2,165.

The Dow is a good example of today's damage given it was repelled at the 20-day MA after major gains; shorts active here.

The Russell 2000 finished with a bearish cloud cover candleline, although with stochastics oversold it's not a strong pattern. The 200-day MA is looking a needed test here.

The semiconductors closed with an isolated gravestone doji - watch for a gap down tomorrow:

For all intents, it's looking like Thursday is going to be a day for shorts/bears. Bulls will have to dig in deep if they are to consume the lingering supply at 50-day and 20-day MAs.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade and is on course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Stock Market Commentary: Bulls need more

noreply@blogger.com (Declan Fallon) — Tue, 03 Nov 2009 14:06:33 PST

Disappointing day after yesterday's set up promised more. Volume was lighter and if it stays like this over the next couple of days it will favor the bears.

The Dow stuck to its 50-day MA but technicals turned net negative

The Russell 2000 enjoyed a decent 1.5% gain but closed a good percentage point away from resistance

Tomorrow is another opportunity, but this time it feels like bulls are holding out for lower prices.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade to the site on the course to becoming the eBay of finance with our new Beta MarketPlace and a new rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Latest Trading Jobs

noreply@blogger.com (Declan Fallon) — Mon, 02 Nov 2009 13:16:18 PST

This week's jobs include

Senior Derivatives Trader
Natural Gas Trader
Equity, F/I Traders, Research and Brokerage Sales/RMs Needed
Senior Taxable Bond Trader
Prop Trader
Equity Trader
Prop Trader

Find more of the latest Trading Jobs Here

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade to the site on the course to becoming the eBay of finance with our new Beta MarketPlace and the first real rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Stock Market Commentary: Scrappy action

noreply@blogger.com (Declan Fallon) — Mon, 02 Nov 2009 13:07:03 PST

With a few minutes left to go it looks like bulls are creating demand at support. The Nasdaq is lingering around a convergence of horizontal resistance at 2,050 and rising channel support. However, supporting technicals are net negative; the last such change to net bullish was over 6-months ago.

The Dow is defending its 50-day MA but has struggled to make back early day gains. However, it's technicals are clinging to net bullish.

But the S&P has turned technical net negative

While the Russell 2000 is on course for the 200-day MA

Today looks like a pause in the downward trend.

Dr. Declan Fallon, Senior Market Technician, Zignals.com. November 2009 has seen a significant upgrade to the site on the course to becoming the eBay of finance with our new Beta MarketPlace and the first real rich internet application for finance, the Zignals Dashboard. Zignals now has new fundamental stock alerts, stock charts for Indian, Australian, Frankfurt and soon Canadian stocks, tabbed stock list watchlists, multi-currency portfolio manager, active fundamental system stock screener and trading system builder. New Forex and Index data.

Weekly Stock Market Commentary:

noreply@blogger.com (Declan Fallon) — Sat, 31 Oct 2009 14:10:16 PDT

First real damage done to the indices in a quite a while. It's not unusual for sharp counter moves in a well established trend to snap back to former levels - but seasonal factors may prevent this from happening here. Fib retracements are looking a good bet for a downside target with the S&P showing clustered price across its fib range of 835-939.

Tech took the harder hit with the Nasdaq 100 down almost 5% with a bull trap

A degree of similiarity between now and early 2007 in the Bullish Percents

One thing in favour of a snap back rally is the Percentage of Nasdaq Stocks above the 50-day MA - it's close to oversold

The Russell 2000 was perfectly pegged by resistance with a new MACD trigger 'sell' to boot - the first index to do so on the weekly chart.

So - all-in-all - it was the first week of significance weakness in a while. The next bounce will likely be jumped upon by shorts. Indices 20-day MAs are likely to be attacked aggressively by shorts.

The de-Santa rally?

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Relief bounce

noreply@blogger.com (Declan Fallon) — Thu, 29 Oct 2009 14:16:03 PDT

If volume was higher there would be a stronger case for another reaction low in the markets - but this thought is on hold for now (stochastics for many of the indices aren't quite there for a reaction low). There were at least bullish crosses of the 50-day MAs for the S&P, Nasdaq and Nasdaq 100; but there is a long way to go before the 50-day MAs are challenged for the semiconductors and small caps.

Have small caps done enough to negate the breakdown - probably - but real resistance will kick in on the convergence of the 20-day and 50-day MAs.

The S&P finished bang on former support, even with a 2.25% gain.

Look for some upside follow through Friday, but if there is a gap up it could be hard for bulls to push it higher - especially if 20-day MAs are nearby. Doji for Friday?

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Bull rout - but markets oversold, or close-to.

noreply@blogger.com (Declan Fallon) — Wed, 28 Oct 2009 15:38:42 PDT

Bulls were nowhere to be found as small caps and semiconductors took the brunt of the damage. Small caps broke support of the most recent reaction low as technicals turned net bearish. The break of the reaction low sets up a measured move target of 525, but support at 535 with follow through to the 200-day MA make for better downside targets.

Semiconductors were little better off; Tuesday saw the loss of the 50-day MA and Wednesday kissed the reaction low good bye. The measured move target of 275 closely approximates the current 200-day MA value - so the 200-day MA is a good downward target to watch for here

With semiconductor strength melting away don't expect the Nasdaq to hang on to its reaction low or maintain its bull channel - although stochastics are almost oversold so some form of relief bounce to the 20-day MA could emerge here.

The S&P didn't escape with a break from the rising channel on heavier volume with a loss of its 50-day MA.

Most indices are approaching oversold conditions and there may be enough demand just below the 50-day MAs to see bulls make a stand.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Techs, Semis and Small Caps Struggle.

noreply@blogger.com (Declan Fallon) — Tue, 27 Oct 2009 14:34:34 PDT

With traditional bull market leaders breaking down it's not looking good for bulls. Further selling saw breaks of the 20-day MA on heavier volume distribution for the Nasdaq and Nasdaq 100 (the latter to a lesser degree).

The loss of the 50-day MA for semiconductors suggest a similar fate is in store for the tech averages

Similarly, small caps took a further knock as its 50-day MA was comprehensively sliced.

As September/October reaction lows are tested a better picture of double tops - and the potential for measured moves down - will become apparent. But it's looking like a top is in place with just large caps hanging on; the Dow was able to dig in heels at its 20-day MA

But for how long?

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Bears build pressure

noreply@blogger.com (Declan Fallon) — Mon, 26 Oct 2009 14:25:18 PDT

Continued selling across markets was combined with an increase in technical weakness. Worst hit were small caps; the rising channel broke to the downside and even nicked a break of the 50-day MA.

The Nasdaq closed with a MACD and on-balance-volume 'sell' as the 20-day MA comes under pressure.

The Dow took it a step further with a registered distribution day in conjunction with a MACD and OBV 'sell'; the losses were enough to redraw the bearish divergence in the MACD.

The doji for the semiconductors at the 50-day MA doesn't inspire confidence as the bull trend disappeared [-DI > +DI; ADX < 20]

All eyes should be on small caps given their importance in leading markets. Today's break of the bull channel likely means a scrappy sideways pattern to follow.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Latest Trading Jobs

noreply@blogger.com (Declan Fallon) — Sun, 25 Oct 2009 15:11:47 PDT

Current round of trading jobs:

Trade Processor / Trader Support
Hourly Trader
MBS Trader
Administrative / Trader Assistant for Finance
Senior Derivatives Trader
Senior Taxable Bond Trader
Equity Trader

Latest Trading Jobs Here

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Weekly Stock Market Commentary: Tiring Rally

noreply@blogger.com (Declan Fallon) — Sat, 24 Oct 2009 13:51:48 PDT

Although it has been a couple of weeks since the last weekly commentary there has been very little change in the state of play.

For the S&P, overbought stochastics are about to meet a MACD trigger 'sell'. A similar event in early 2007 did not bring an immediate top but selling then marked a reasonable exit given the events which followed.

The Nasdaq is still going strong - as is the March 30th 'Buy' signal - but the same pressures at play in the S&P apply here.

The Nasdaq 100 pushed above converged resistance with 2008 highs the next port of call:

But sentiment remains firmly in the bear camp. The percentage of Nasdaq stocks above the 50-day MA has been on a 'sell' trigger since July 2nd

And the Summation Index since July 10th

With the Russell 2000 the only index struggling against resistance.

The actual top may not be far in terms of price, but the time factor could see another 6-9 months of bullish bias. Hard to be a buyer but existing holders might find it hard to let go.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Support at 20-day MA and 50-day MAs

noreply@blogger.com (Declan Fallon) — Thu, 22 Oct 2009 14:03:49 PDT

Yesterday's sell off suggested a rough Thursday was ahead but bulls were able to defend the 20-day MA in the Nasdaq and 50-day MA in the Russell 2000. For the Nasdaq there was a bullish engulfing pattern/hammer to boot.

The Dow had a more clear-cut bullish engulfing pattern, well above its 20-day MA, but in the absence of oversold stochastics can be considered a weak signal.

The Russell 2000 rallied back into the lower regions of its 615-625 scrappy congestion. Much work to do but at least the 20-day MA was regained - but it gets much harder for bulls here.

The semiconductor index went one step further and found support at its 50-day MA and was able to finish above its 20-day MA, but this index has long since broken from its summer rally.

Breadth is also very negative with sharp turns of weakness for the Percentage of Nasdaq Stocks above the 50-day MA and Nasdaq Summation Index; note the extent of the negative divergences between breadth and the parent index.

False hope for bulls - or more of the same? Bears will win out eventually, but now has their time arrived now?

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Late day collapse

noreply@blogger.com (Declan Fallon) — Wed, 21 Oct 2009 14:01:51 PDT

Far greater damage done after a wide range day started with new highs - but closed at the day's lows. Volume climbed to register a distribution day which sets up the possibility for a double top. Watch September reaction lows for support as this will form the neckline for any double top.

But for all the indices the first test will come from 20-day MAs, with 50-day MAs very close by.

The Nasdaq 100 closed with a bearish gravestone doji on technical distribution. This is the first time in a while where there has been three consecutive distribution days for the index

The Dow gave up the 10,000 media love-in but has plenty of room to its 20-day MA. But the cracks are getting bigger.

The Russell 2000 took a big step down with its MACD trigger 'sell'. Like the semiconductor index, it's in the process of a 20-day MA test.

From these charts it would appear small caps and semiconductors are going to lead the market into a long awaited down phase.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Distribution but no real weakness

noreply@blogger.com (Declan Fallon) — Tue, 20 Oct 2009 13:30:07 PDT

The losses on heavier volume rank as distribution but on a point scale the losses were mild. However, it wasn't the upside follow through which yesterday's gains had set up. The biggest hit came with small caps and the bearish engulfing pattern brought the index towards its 20-day MA with relative strength shifting back in favour of tech indices; markets are now in their most bearish alignment of large caps > tech > small caps.

The semiconductor index had a shooting star (which fell outside of overbought stochastic levels so it's a weak candleline) along with a MACD trigger 'sell'. An underlying weakness influencing tech averages.

The weakness in tech averages is apparent in the percentage of Nasdaq stocks above their 50-day MAs. Since peaking in May the percentage has dropped from 85% down to 68% of stocks above this key moving average. How long can this rally last and how hard will it fall when the inevitable decline arrives?

How much desire is there from sideline money to come in here?

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Latest Trading Jobs

noreply@blogger.com (Declan Fallon) — Mon, 19 Oct 2009 15:47:59 PDT

Only a small number of jobs this week:

Assistant Trader with Series 7 - Debt and Equity Experience a Must
Oil Trader
FX Processing Specialist
Commodity Trader
Equity, F/I Trader, Research and Brokerage Sales/RMs Needed
Equity Trader
Prop Trader

For more jobs like these see here

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Bull comeback with little volume

noreply@blogger.com (Declan Fallon) — Mon, 19 Oct 2009 14:42:30 PDT

It was set up for a good day for the bulls with respectable gains, but volume was lacking. The market is now well set up for some follow through and further gains will mean new 52-week highs for the indices.

The Dow is back against channel resistance with a break of the negative divergence in the MACD - this is a bullish set up for Tuesday.

Even the semiconductor index was able to dig in at its 20-day MA

Will tomorrow see more bull gains? If so - and they are going to stick - then some decent volume better go with them.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Buyers Join Afternoon Fun

noreply@blogger.com (Declan Fallon) — Thu, 15 Oct 2009 13:59:05 PDT

It was a day where bulls were expecting the bears at the party, but the bears never showed so they took over and partied late into the night (or afternoon...). The returns were modest but important was not losing yesterday's gains. On a chart none of it looked like much.

One thing I hadn't quoted yesterday was the MACD trigger 'buy' in the Russell 2000 - the current market leader

But there was one worrying sign in the semiconductor index; a shooting star reversal at former channel support turned resistance. A CCI 'sell' trigger adds to the probability for a larger downward move

One significant positive was the net bullish supporting technicals in the Percentage of Nasdaq stocks above the 50-day MA:

Can other breadth indicators follow suit? Might see a little weakness on expiration Friday.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Positve Response

noreply@blogger.com (Declan Fallon) — Wed, 14 Oct 2009 13:35:13 PDT

After two days of quiet trading markets perked up on heavier volume, closing at their highs. There was also some technical improvement with a MACD trigger 'buy' for the Nasdaq - although it continues to underperform against the S&P.

The Nasdaq 100 also enjoyed a MACD trigger 'buy' on accumulation:

The Dow is again bumping against upper channel resistance. However, any break would produce an unsustainable run given the angle.

But the rally in the S&P is looking very healthy:

With today's gains the last attempt by bears to break the run in September is now history.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commntary: Indecision Day 2

noreply@blogger.com (Declan Fallon) — Tue, 13 Oct 2009 13:49:22 PDT

Another day, another doji for the markets. You could more or less copy-and-paste yesterday's comments for today. There were only two points of interest. First was the positive test of the 20-day MA in the Russell 2000

Second was the MACD trigger 'buy' for the SOX. However the index finished below resistance.

On the breadth front there was a bullish cross of the 5-day EMA for the Bullish Percents.

With the VXN toying once more with long term support

We'll see how it will all mix up down the road.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Stock Market Commentary: Indecisive Doji

noreply@blogger.com (Declan Fallon) — Mon, 12 Oct 2009 14:48:48 PDT

Breaking to new highs was a step too far for some of the indices after prior five days worth of gains. But the days' indecision was not accompanied by heavier volume churn so it would appear to play more towards a consolidation than a reversal point. However, a gap down tomorrow would give bears something to work with.

The Nasdaq looks ready to repeat a mid-August like retracement; the October reaction low - and/or 50-day MA - will be critical for bulls to defend if Tuesday opens on weakness (in order to maintain the sequence of higher highs and higher lows). MACD trigger line inching towards a 'buy' trigger.

The Dow was an exception in it was able to make a new higher high with a MACD trigger 'buy' and bullish cross for on-balance-volume:

The semiconductor index crept over former channel support but closed on the line. It looks the most vulnerable to an Evening Star candle line.

Tomorrow will likely see some follow through downside but it will be the volume that accompanies it which will be of greater interest (up or down).

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.

Weekly Review of Stockcharts.com Publishers' Charts

noreply@blogger.com (Declan Fallon) — Mon, 12 Oct 2009 02:43:51 PDT

Another excellent week for bulls with bears felling the force of momentum against them.

Anthony Caldaro of Objectiveelliotwave.com looks to have backed down on his bearish 'ABC' count and has taken a more bullish (?) new 5-wave trending phase - wave 2 of 5 about to develop?

Yong Pan of Cobrasmarketview has more bearish than bullish signals for both short and intermediate term, but nothing unusual with this in recent months

But, in the following chart there is still a confirmed trendline break - even with 5 days of gains.

Same broken trendline going back to March

And another resistance line here

However - lovely bullish cup-and-handle breakout on the 5-min SPY:

Richard Lehman has markets pointing upwards once more with the October meltdown unlikely to be significant (if occurring at all!)

10/11 -- The hourly charts are rather clear now in showing the recent uptrend. This removes the scenario of a repeat of the 10% June-July correction -- at least for now. In the longer picture, everyone will be focusing on (if not expecting) new highs for the year here -- a particularly joyous event for bulls who thought we'd see an October rout, and a particularly frustrating event for the bears who felt they would at least have seasonal influences at their back.

One thing I've noticed, despite this recent turn back upward, is that long term momentum is flattening. This would seem only natural as the markets have now clearly built in an exceptionally positive view of the economy and are likely to stall here while we see if the economy can oblige. This would suggest a possible scenario from here as one where markets move essentially sideways, experiencing more frequent, albeit less dramatic, sell-offs rather than one large one as many expected for October. Also, while earnings are expected to be positive for Q3, it is widely acknowledged that this will not provide projectable earnings-driven momentum at the same rate into 2010.

Dr. Joe noted Friday's gains for the semiconductors - perhaps the best news for bulls on the week.

Joes' Bull Head-and-Shoulder reversal for the XLF; target of $17.50 and/or 38% retracement of $17.60

Finally, Matthew Frailey of Breakpointtrades has so far stuck with the confirmed rejection of resistance for the Russell 2000; no reason to be a buyer until 65.00 is breached.

But, even with all the toppy sentiment it is hard not remain a bull. While buying here is risky and selling at a confluence of resistance makes sense, the market has continued to ignore what have in the past been markers for tops. A top will come soon for sure but the case for a move all the way back to March lows is not looking hugely compelling.

Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, stock charts, watchlist, multi-currency portfolio manager and strategy builder website. Forex data available too.