Daily Market Commentary: Selling Day 2

From Fallond Stock Picks
February 21, 2013 - 6:01pm

In the end, 20-day MAs didn't prove to offer too much of a defense from sellers. Volume climbed in confirmed distribution as profit taking ruled the day's action. Next in line are 50-day MAs.  These should offer a more substantial defense.The move to selling has coincided with a relative shift away from speculative Small Caps to defensive Large Caps.The Nasdaq is likely to be the first index to test the 50-day MA. It was unusual to see today's biggest loss attributed to the Nasdaq given its more modest ascent. But action here will be a good proxy for the Russell 2000 and S&P. Friday may give the first indication of future expectationsThe driver for the selling in the Nasdaq was the steep losses in the semiconductor index. It's heading to the 50-day MA, and likely down to the rising channel.The Russell 2000 cracked its 20-day MA and is staring down at its 50-day MA.  Given the distance between the respective MAs, there may be short trade on the move; look to attack a bounce to the 20-day MA.For Friday, shorts will be looking to attack any bounce back to 20-day MAs. 50-day MAs are downward targets.---Follow Me on Twitter Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. You can read what others are saying about Zignals on Investimonials.com. JOIN ZIGNALS TODAY - IT'S FREE! Fallond Stock Picks


Share this article »  

Continue reading this article »