******* MARKET NEWS & CONDITIONS *******
siliconinvestor.com
Pattern recognition; this time in the Nasdaq. Prices "tested" levels underneath Thursday's lows before reversing higher into the close. By definition, "open test-drive". Of course, it wasn't until prices bid above the 1472 opening before recognition can be more than just speculation. Unfortunately, this short-term bullishness only managed to test the upper boundary of a bearish trend line beginning from mid-May. A series of lower highs and lows most likely will continue controlling sentiment going forward. Rising 8 points to 1504, the tech-laden Nasdaq might force shorts to cover positions if 1526 is cleared; however, 1560 still remains a Rubicon - the "line in the sand". As a side note, the Nasdaq has finished higher from its opening range 5 out of the last 9 sessions.
Economic data, terrorist activity, and bearish analyst comments out of Europe may have been the culprit for early morning weakness within the Dow (falling 240 points intra-day); however, did everything suddenly turn around in the afternoon in order for prices to close down only 28 points at 9474? Doubtful. Moreover, why didn't the flight-to-quality into Treasuries reverse as the blue chips found strength? Not sure either. Even gold was relatively strong throughout Friday's trading. So, which ancillary evidence to follow? Good 'ol common sense, "What is least resistance going forward, higher or lower?" Signs still point lower. Support lies near 9175 with resistance staggering upwards: first near 9500, then 9550, followed by 9625.
John Seckinger, Associate Analyst |
