NASDAQ Commentary (via Your Ecomony Thread of iHub)
The NASDAQ ended the shortened week at 2434.25, losing 19.18 points on Friday (-0.78%), but still gaining 18.96 points (+0.78% for the three session week. As far as any sort of decisive move - in either direction - we'd have to say there wasn't one. Instead, the composite seemed content to hover right around its recent range, and stay within the confines of what is becoming a long-term flattened channel. As such, we're still on the sidelines about what to think of the NASDAQ.
What's bullish? For starters, note the support that the index has found at the 50 day moving average line (purple). Simultaneously, note the support we've seen from the lower edge of the sideways channel (yellow) that's been in place since November. Granted, finding support doesn't have to mean things are bullish - it just means things aren't sinking. However, 'surviving' a period that should be corrective (at least to many traders) can be bullish in the sense that it buys time until the bulls are ready for another round.
Besides that, you'll see how we're right on the verge of a MACD crossover, and we're already into a stochastic buy signal.
What's bearish? In a word, Friday. Investors didn't want much to do with stocks just before the weekend came -a subtle sign that they're not overly interested in holding them in general. Plus, it's clear the pace of gains we were enjoying late last year is no longer the same pace we're experiencing now. In fact, there is no 'pace' to speak of...things have been flat for weeks now. While a flat market is no more bearish than bullish, it's also no more bullish than bearish. The longer the market stays stagnant, the greater the possibility that any buyers will lose interest altogether (the other side of the coin we discussed in the 'what's bullish' commentary).
So like we said on Thursday, the NASDAQ's chart is basically putting us on hold. What we're waiting for is a break under support at 2394, or a break above resistance at 2470. In the meantime, it looks like we're just stuck in the range.
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