***** Technical Analysis (January 5)****
A strong rally on heavy volume today increases the odds that either this accumulation activity can last for a while, or at least this will be another choppy leg up, and technicians would like to see positive breadth and heavy volume for at least the next two days even if some of the indices show declines tomorrow, Tuesday.
The Nasdaq a/d was 2/1, up/down volume 8/3, on heavy volume of 2.4B shares. The NYSE a/d was 2/1, up/down volume 3/1, on 1.6B shares, which is moderate to mildly heavy.
The Dow may continue a choppy rally to 11,000 in January while the Nasdaq should have little trouble retesting the 2098 prior high. But unless we get continued heavy volume rally days Tuesday and Wednesday, this leg up will be choppy as was usual last year.
Gold has broken out well above the $415/oz. level, and as long as the USD remains weak, it may not fall below $400/oz. After that support level, the next one is at $388/oz. Ultimately gold may reach $460/oz this year, with an outside chance of $500/oz.
The USD can't seem to get much of a technical bounce and it may not get a bounce until it reaches 85 in the futures pit as it failed to hold the 87 level last week. It may not see the 90's again for many years.
The energy complex remains strong and there is little fundamentally to cause a sharp decline or a much lower trading range for crude and natural gas.
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.
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