After a few days of tight trading the nascent rally took another step higher. Volume rose to register an accumulation day (albeit against a low volume bank holiday Friday), but it’s all good if you are a bull.
The one index which marked a technical improvement was the Russell 2000. Today saw a MACD trigger ‘buy’ as the index finished just below its 20-day MA and former support turned resistance.
The S&P is a day’s gain away from the 20-day MA but it has an additional few days of upside before it encounters resistance at the declining channel.
It was the same story for the Nasdaq, although the 20-day MA is running close to falling channel resistance.
In general, the indices (with the exception of the Russell 2000) are very close to seeing MACD trigger ‘buy’ signals. A MACD ‘buy’ combined with a cross above 20-day MAs could offer fresh upside follow through for the indices. Given the proximity of indices to their 20-day MAs it’s looking likely tomorrow or Thursday will be the required follow through day to strengthen the rally.
Dr. Declan Fallon is the Senior Market Technician and Community Director for Zignals.com. I offer a range of stock trading strategies for global markets which can be Previewed for Free with delayed trade signals. You can also view the top-10 best trading strategies for the US, UK, Europe and Rest-of-the-World in the Trading Strategy Marketplace Leaderboard. The Leaderboard also supports advanced search capability so you can tailor your strategies to suit your individual requirements.
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