***** Technical Analysis (Dec. 30)****
One of my favorite indicators is linked below and has implications for the intermediate term:
stockcharts.com[m,a]waclyyay[pc30!c20][vc60][iUd20!Ua12,26,9]&pref=G
The CCI is moderately overbought while the NASI weekly and other indication is neutral from a longer perspective. This indicates a neutral risk-reward ratio for the Nasdaq from an intermediate standpoint.
There are not very good signals from a short term perspective either, as those signals are mixed.
Since we made a bottom and rallied from there and have not reached extremely overbought levels on longer term indicators, there is a chance of another rally, choppy at best, in the next several weeks, perhaps longer, if it needs to have a retest.
From a long term view, the high relative strength sectors are likely to remain that way, such as energy. Short term they have corrected moderately. Stochastics are mostly oversold on the dailies but the slower stochastic does not indicate a bottom has been reached yet as it is still high. Daily MACDs are crossed down, bearish still.
For 2006, small caps are likely to outperform the large caps once again as that is where the growth is.
Traders will do best if they trade ranges this year, in my opinion, until there is a definite breakout either way.
Dr.Bob's commentaries are not to be construed as recommendations to buy or sell stocks, options, or ETF's as Dr.Bob is not a Registered Investment Advisor. Information and data provided here is believed to be reliable but cannot be guaranteed to be accurate.
Always do your own research and due diligence before investing or trading. Remember that Technical Analysis can change by the day, and as such, one day's TA may not be the next day's TA interpretation.
Dr.Bob's mission is to teach Technical Analysis and demonstrate a structured approach to Market Analysis, for position and swingtrading. There are many other TA structures, strategies and systems.
Dr.Bob no longer hosts Stocktimers meetings on Sunday nights at AOL. |
