roguetrader
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Yet another interesting week for the markets to start off the quarter.The post FOMC bounce that User spoke of, and speculated on, was continued into Tuesday with fairly steady gains followed by a selloff Wednesday that erased them.
Again as I spoke of last weekend, we had mixed signals with the COMPQ showing relative strength. Then of course we had the London terrorist attacks which caused a significant gap down in the market on open. Whilst the INDU and SPX set new intraday multi-week lows the COMPQ held the 2050 support and a substantial turnaround ensued which ended with all three indices in positive territory on the day. Fridays action followed through on this reversal with a substantial days gains in a strong trending day, which interestingly saw INDU the long time laggard move to the head of the class. The index managed to push through its 50, 200, and 20 day smas, and also retake the up trendline.
The COMPQ breached the 2100 resistance level that has more or less capped it since early June. Market internals on Friday were very strong denoting a broad based advance. Advancers outnumbered decliners on the NYSE by some 3:1 while up volume was about 4:1 in relation to down. Impressive stuff, the question of course are we witnessing the beginnings of a leg higher or just the euphoria that the tragic events of the week were not much worse, or in NY.
I will look at the individual indices a little later.
Again as I spoke of last weekend, we had mixed signals with the COMPQ showing relative strength. Then of course we had the London terrorist attacks which caused a significant gap down in the market on open. Whilst the INDU and SPX set new intraday multi-week lows the COMPQ held the 2050 support and a substantial turnaround ensued which ended with all three indices in positive territory on the day. Fridays action followed through on this reversal with a substantial days gains in a strong trending day, which interestingly saw INDU the long time laggard move to the head of the class. The index managed to push through its 50, 200, and 20 day smas, and also retake the up trendline.
The COMPQ breached the 2100 resistance level that has more or less capped it since early June. Market internals on Friday were very strong denoting a broad based advance. Advancers outnumbered decliners on the NYSE by some 3:1 while up volume was about 4:1 in relation to down. Impressive stuff, the question of course are we witnessing the beginnings of a leg higher or just the euphoria that the tragic events of the week were not much worse, or in NY.
I will look at the individual indices a little later.
JillyB
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For what it's worth, I saw Friday as being quite a pivotal day. After the terrorist attack in London on Thursday, the market regained all that it had lost that day and managed to add on a few extra points - basically bringing us back to the level we were at before. On Friday we saw a continuation of the upward movement and what was more significant was the break of resistance at 10,400.
During the day I was watching the index, knowing that to close above this level was the most important issue. It was ok for it to push above this level during the day, but to have any impact it needed to hang onto the gains it had made during the day and close above 10,400. The close at 10,449, showed that it had achieved this and in doing so seen an upward movement of over 140 points.
The DJI is now up against another level of support and resistance which is the underside of the consolidation from mid-May to Mid-June. If it breaks through this then it could well test the 10,650 level again. Although the gains on Friday were significant it was done on the back of reduced volume - once again - and it will be interesting to see if this upward movement can be maintained this week.
My personal view is that it will, and we will see a retest of 10,650 this week. However after that I am starting to wonder if we could see a more substantial drop and perhaps 10,000 may be on the cards in the following week (I know FC will like this 600 point movement).
During the day I was watching the index, knowing that to close above this level was the most important issue. It was ok for it to push above this level during the day, but to have any impact it needed to hang onto the gains it had made during the day and close above 10,400. The close at 10,449, showed that it had achieved this and in doing so seen an upward movement of over 140 points.
The DJI is now up against another level of support and resistance which is the underside of the consolidation from mid-May to Mid-June. If it breaks through this then it could well test the 10,650 level again. Although the gains on Friday were significant it was done on the back of reduced volume - once again - and it will be interesting to see if this upward movement can be maintained this week.
My personal view is that it will, and we will see a retest of 10,650 this week. However after that I am starting to wonder if we could see a more substantial drop and perhaps 10,000 may be on the cards in the following week (I know FC will like this 600 point movement).
Racer
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Worth a look at the IBEX post Madrid bombings and the reaction
http://uk.finance.yahoo.com/q/bc?s=^IBEX&t=2y&l=on&z=m&q=l&c=
http://uk.finance.yahoo.com/q/bc?s=^IBEX&t=2y&l=on&z=m&q=l&c=
roguetrader
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Indu
With the INDU once again above its major SMAs we are poised for another interesting week as earnings season continues to ramp up. Last week saw AA report and beat forecasts which may have given a confidence boost on the unfolding season.
Volume on Friday was a little disappointing I would have thought for the bulls, I would have expected a move such as this if it were a serious beginning of a leg higher to attract more volume. Trouble is we are now into the summer doldrums when typically volume dies off and it becomes difficult to conclude much from.
Looking forward we will need to see an early push in the index to confirm the regaining of those MA's and that will be critical for the INDU to make any further headway. Also looming overhead is the consolidation range of mid-May - mid-June which has the potential to provide significant resistance. Basically I see resistance all the way to the last swing high around 10,656. The first level I would be looking for would be a move above 10,550 ish this coincides with closing prices of the consolidation in May and March. Downside support may appear at the MA's, 20 and 200 where we are now and the 50 sma at 10,411. Effectively I see a band of support extending back to about !0,370 and below that the recent favourite at 10,250. Essentially the INDU is now in no-mans land between tow consolidation areas
With the INDU once again above its major SMAs we are poised for another interesting week as earnings season continues to ramp up. Last week saw AA report and beat forecasts which may have given a confidence boost on the unfolding season.
Volume on Friday was a little disappointing I would have thought for the bulls, I would have expected a move such as this if it were a serious beginning of a leg higher to attract more volume. Trouble is we are now into the summer doldrums when typically volume dies off and it becomes difficult to conclude much from.
Looking forward we will need to see an early push in the index to confirm the regaining of those MA's and that will be critical for the INDU to make any further headway. Also looming overhead is the consolidation range of mid-May - mid-June which has the potential to provide significant resistance. Basically I see resistance all the way to the last swing high around 10,656. The first level I would be looking for would be a move above 10,550 ish this coincides with closing prices of the consolidation in May and March. Downside support may appear at the MA's, 20 and 200 where we are now and the 50 sma at 10,411. Effectively I see a band of support extending back to about !0,370 and below that the recent favourite at 10,250. Essentially the INDU is now in no-mans land between tow consolidation areas
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roguetrader
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Spx
As has been typical lately the SPX continues to look more healthy than the INDU. Friday's close at 1211 puts it back above the consolidations. During the recent down moves the SPX never closed below the 38% retrace from the April lows to June highs, this is consistent with a simple correction.
To the upside, the target for SPX would be the 1220 area followed by the year highs at 1229.
To the downside SPX has all major MA's that I follow, 20 sma at 1203, 50 at 1190 which sits fairly close to a swing high from April and an up trendline from April lows on a closing price basis. And the 200 sma at 1177 which is closing in on a swing high from early May.
As earnings start to hit this week, and we see what follow through is forthcoming from the last two days we should get a better idea of what lies ahead
As has been typical lately the SPX continues to look more healthy than the INDU. Friday's close at 1211 puts it back above the consolidations. During the recent down moves the SPX never closed below the 38% retrace from the April lows to June highs, this is consistent with a simple correction.
To the upside, the target for SPX would be the 1220 area followed by the year highs at 1229.
To the downside SPX has all major MA's that I follow, 20 sma at 1203, 50 at 1190 which sits fairly close to a swing high from April and an up trendline from April lows on a closing price basis. And the 200 sma at 1177 which is closing in on a swing high from early May.
As earnings start to hit this week, and we see what follow through is forthcoming from the last two days we should get a better idea of what lies ahead
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roguetrader
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Compq
The COMPQ remains the stronger of the three major indices at the moment, it has shown a reluctance to pull back during the recent market weakness and barely retraced 25% of the gains from April lows. Troubled by resistance at the 2100 level, Fridays close puts her well above that at 2112. The year high stands at 2191 which is still quite a ways away. Currently the COMPQ stands at its highest closing level since the beginning of Jan.
To the upside potential resistance may appear in the 2150 - 2160 range which would represent swing highs from '04, then the Jan high at 2191.
To the downside 2100 should now act as support or as they say "all bets are off." Below that is the 20 sma at 2074, followed by recent support at 2050 and the 50 sma at 2039.
The COMPQ remains the stronger of the three major indices at the moment, it has shown a reluctance to pull back during the recent market weakness and barely retraced 25% of the gains from April lows. Troubled by resistance at the 2100 level, Fridays close puts her well above that at 2112. The year high stands at 2191 which is still quite a ways away. Currently the COMPQ stands at its highest closing level since the beginning of Jan.
To the upside potential resistance may appear in the 2150 - 2160 range which would represent swing highs from '04, then the Jan high at 2191.
To the downside 2100 should now act as support or as they say "all bets are off." Below that is the 20 sma at 2074, followed by recent support at 2050 and the 50 sma at 2039.
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chipper338
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Jill,
I agree. I am wondering about next weeks follow through. Will it contiue to rally to recent R and fade or simply range next week? Right now, I feel it will continue to range.
Chip
I agree. I am wondering about next weeks follow through. Will it contiue to rally to recent R and fade or simply range next week? Right now, I feel it will continue to range.
Chip
