Daily Market Commentary: Consolidation Day 5
From Fallond Stock Picks
January 10, 2013 - 4:45am
If you are a bull, the past week's action has been very kind. Tight action, over an extended period, favors a big reaction move. The resulting move should come in the direction of the prior trend, which in this case is bullish. New longs can look to place a stop below the 5-day low. Aggressive players may wish to play a short on the break of the 5-day low as it would mark a 'fake out' of the bullish thesis (stops coming in above the 5-day high in this case).The S&P shows the bullish flag which 'should' break higher. Technicals are bullish (with the exception of On-Balance-Volume, although this is likely to turn bullish on the next up day).Notice how the breakout gap in the Nasdaq hasn't been violated; another bullish sign. The only ugly is down trending On-Balance-Volume.While the Russell 2000 is pressuring its high even within the tight consolidation. &...
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